CharteredONE The official magazine of the Liverpool Society of Chartered Accountants
Liverpool Society of Chartered Accountants celebrate newlyqualified accountancy talent
The Chartered ONE BIG interview - Nigel Lanceley
Chris Wainwright Gentlemen I give you...
ISSUE 31 WINTER 2021
LSCA Business
Chester Town Meetings
The first face to face meeting of Chester Town Group for 18 months took place on Wednesday 8th September in Chester. We met at Military House, which are the new Chester offices of Haines Watts, which of course was previously Pursglove and Brown. The meeting was well attended, and those present were all pleased to meet other Chartered Accountants in the flesh for the first time in 18 months and we enjoyed a very pleasant sandwich lunch. Most of the time was spent in catching up with each other on what has gone on over the
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last 18 months. We were so amazed at the success of this, that in November we did it again. Chester Town Group meets each quarter for an hour or so usually over a sandwich lunch. All Chartered Accountants in or around Chester (we have a very wide catchment area!) are welcome to come along. Jonathan Jones of Morris & Co., is our Chairman and if you would like to be kept in touch with the dates of future meeting of Chester Town Group then please email Jonathan or Nick Ledingham of Morris & Co on NOL@moco.co.uk.
LSCA Business
The President's Words To cap off this flurry of ‘real’ meetings I have just chaired my first physical meeting of the committee of the Liverpool Society of Chartered Accountants, another first for me."
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t last as president I am able to report having been somewhere on official duties - it has only taken nineteen months. It was great to be able to get together with other District Society Presidents at The Belfry to receive an update from ICAEW on a number of key areas. My second outing was to Harrogate to join some of the outgoing Presidents from last year to recognise and celebrate David Matthews’ year as National President. As with the other meeting it was, as I’m sure we have now all found on many occasions, strange meeting people in person whom I had only previously met on Zoom.
I was then pleased to attend a service at the Anglican cathedral to celebrate the start of the legal year as a guest of Nigel Lancley FCA, The High Sheriff of Merseyside – and there’s an interesting interview with Nigel and our Editor within this issue. Finally I was pleased to attend the Law Society Annual Dinner with legal awards which gave me my first opportunity to wear the presidential badge of office. To cap off this flurry of ‘real’ meetings I have just chaired my first physical meeting of the committee of the Liverpool Society of Chartered Accountants, another first for me.
One of the subjects we discussed was the real possibility of holding the much-postponed celebration of our 150th anniversary – the Sesquicentennial as you will recall. Omicron or other variants allowing, we are planning a ‘real’ event in the spring of next year, and we hope to confirm this in the New Year. Meanwhile, may I wish you all a Merry Christmas and a Happy and prosperous New Year Best wishes,
ROB YOUNG President
CharteredONE
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ISSUE 31 Winter 2021
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LSCA Business
Contents 18
26 ANDREW LLOYD - DO PEOPLE REALLY WANT TAX CUTS IF THAT MEANS POORER PUBLIC SERVICES? 28 BLANKSTONE 30 DSG - OWNERS OF CRYPTOASSETS ASKED TO CONSIDER CGT 32 LIVERPOOL SOCIETY OF CHARTERED ACCOUNTANTS CELEBRATE NEWLYQUALIFIED ACCOUNTANCY TALENT 40 DSG -UK BUDGET – AUTUMN 2021 – A STRONGER ECONOMY FOR THE BRITISH PEOPLE
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42 ANDY BOUNDS - CHRISTMAS QUIZ 44 OPUS 45 ICAEW - INFORMATION HUBS
02 CHESTER TOWN MEETINGS 03 THE PRESIDENT'S WORDS 05 REFLECTIONS FROM OUR EDITOR 06 COODEN TAX CONSULTING: ARE WE THER YET? 08 DOCUMENT DIRECT 09 DAVID CRADDOCK 12 DSG - SOCIAL CARE LEVY AND STATE PENSION BLOCK 13 DSG -REDROW FOUNDER KEYNOTE SPEAKER AT LATEST DSG SPONSORED IOD EVENT 14 NORTH WEST BUSINESSES OPTIMISTIC FOLLOWING CHALLENGES OF 2021
15 I CAEW AND CIPFA - EXPLORING POTENTIAL FOR CLOSER WORKING 16 SMARTVAULT
46 TECHNICAL REPORT 48 LEGAL RSS
18 CHRIS WAINWRIGHT GENTLEMEN I GIVE YOU... 20 L IVERPOOL SOCIETY OF CHARTERED ACCOUNTANTS – EQUALITY, DIVERSITY AND INCLUSION 21 I CAEW NORTH WEST REGIONAL PROGRAMME OF EVENTS JANUARY – MARCH 2022 22 THE CHARTERED ONE BIG INTERVIEW NIGEL LANCELEY 25 J AN MCCORD - HOW LOCKDOWN CHANGED MY LIFE
COVER PHOTO By Graham Bond, Managing Partner RSM/ Liverpool & Chester and Past President
LIVERPOOL SOCIETY OF CHARTERED ACCOUNTANTS
PRESIDENT Rob Young president.liverpool@icaew.com CHARTERED ONE EDITOR Martyn Best martyn.best@charteredone.co.uk For all content and advertising enquiries please contact Martyn Best.
The Liverpool Society of Chartered Accountants was founded in 1870 and is the oldest district society in the Institute of Chartered Accountants in England & Wales, and was one of the four founding societies of the ICAEW. The Society has an illustrious history and has provided in Harmood Banner, Arthur Green and Ian Morris, three National ICAEW Presidents. Awarded the Freedom of the City of Liverpool in 2011, the Society continues to play an active role in local and ICAEW issues. There are over 1.7m chartered accountants around the world – talented, ethical and committed professionals who use their
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expertise to ensure we have a successful and sustainable future. Over 150,000 of these are ICAEW Chartered Accountants. We train, develop and support each one of them so that they have the knowledge and values to help build local and global economies that are sustainable, accountable and fair. The ICAEW have been at the heart of the accountancy profession since we were founded in 1880 to ensure trust in business. We share our knowledge and insight with governments, regulators and business leaders worldwide as we believe accountancy is a force for positive economic change across the world.
LSCA Business
Reflections from our Editor We have a new feature starting this issue with a Chartered ONE BIG interview, and I’m delighted to have met with Nigel Lanceley, our High Sheriff who is a thoroughly charming and fascinating character."
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ell, here we are – it’s nearly Christmas, and then, can you believe it, 2022. I hope you have been well throughout this rather unusual year, and whether working from home or from office, that your sanity has been preserved. Here at your Society, I was overjoyed that we have finally had a ‘real’ meeting as described by Rob Young, our President, and this was followed by an actual luncheon, just hours before such activities were once again frowned upon. It did really highlight, however, the value of actual human interaction and how much more is gleaned from direct contact, and the chance to develop conversations and gain a better
understanding and develop ideas instead of having a brief video window. Real live meetings might actually catch on!
huge commiserations of course to Lewis Hamilton on being ruthlessly and unfairly deprived of his historic 8th Formula 1 world championship.
We have a new feature starting this issue with a Chartered ONE BIG interview, and I’m delighted to have met with Nigel Lanceley, our High Sheriff who is a thoroughly charming and fascinating character.
I’m sure he’ll be overwhelmed by the good wishes of our members. It has reminisces of Tranmere Rovers being demoted from League ONE a couple of seasons ago.
I’ll be seeking out other local members of our Society in forthcoming issues, and do please let me know if there is someone who would have a story or two beyond the profession. On the sporting front, it’s been fairly quiet since the last issue, and it seems that our cricketers will be having an Ashes challenge to change that; but
Back to my first line, and may I wish you and your family and friends the very best for a happy and peaceful Christmas, and my very good wishes for everything that the new year will herald. With very kind regards, MARTYN BEST Editor & Past President
CharteredONE is designed and published on behalf of the Liverpool Society of Chartered Accountants by Legal RSS.
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ISSUE 31 Winter 2021
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LSCA Business
Are we there yet? Four words that used to drive any parent absolutely insane, but after the last 14 months, are probably now music to the ears of a lot of us. by Simon Bulteel of Cooden Tax Consulting
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I don’t know about you, but out of an abundance of caution, we didn’t take our summer holiday to Europe last year, and we didn’t take our children to any of the places we might normally have done during the summer holidays. That meant avoiding adventure parks; zoos; and soft plays, places they love, but, where there would be lots of people, just to be safe. So instead, we got a National Trust membership and probably annoyed a lot of people out for a quiet walk in the grounds of many properties, by taking our three children for days out and picnics! But this May Bank Holiday weekend, we went out, out! On Friday, my wife went and had drinks with 5 of the school mums, and on Sunday we took our three boys to a Miniature Railway and on Bank Holiday Monday they went to an adventure park as well. Now, I haven’t yet applied that level of bravery to my business life, I haven’t had a face to face business meeting since early October, but I think we are almost there! Have I been too cautious? Probably, professionally being an accountant, I see myself as generally risk averse and yet as an entrepreneur running a niche tax consultancy, I know I have to throw off my cloak of pessimism and be more “out there”. That being said, it’s not held our business back, when it comes to preparing R&D Tax Relief claims for many businesses, working over video conference and conducting our technical interviews through this medium, rather than face to face has proven to work and is something that we may continue into the future, if that is what our customers want. However, even though we have been able to keep preparing claims for those business in Manufacturing and Engineering, where we know them and have been around the factory floor, there has been a semblance of business as usual. For those who we have worked with for the first time during lockdown, there is a nagging thought at the back of my head that by not being present, by not walking through and seeing what is going on and being able to ask questions in the here and now of such a walk, have we been able to identify all of the R&D activities. There are only so many times you can ask is there anything else, anything new, anything that you are doing differently, anything that you have improved, before beginning to sound like that child in the back seat pre-lockdown.
We are almost there, we are seeing the opening up of society, we can now drink in a pub, have a meal inside and go to the cinema or theatre, we have seen some trial mass participation events, lots of little steps! I still feel that I am giving the stock response, that might be given to the children, “we are almost there, not long to go now!” It is still open ended to some extent, but I am ready to get out there again! I am sure it will be a little bit different at the start, but hopefully, we will get there! So, now to you, how are you doing? How positive are you for the next 12 -18 months of your business? Have you taken out some BBLS or CBILS funding that needs to start being paid back anytime soon? Have you been doing something new and interesting in your business over your previous 2 accounting years, even pre-pandemic? Has it involved an element of scientific or technological uncertainty? Has it been ultimately successful? Or did it fail and has had to be put on the shelf for the time being? If you’ve answered yes to any of those last questions, why don’t you give me a call? I’d love for you to be the first business I come out and see, when we are both ready! We can start with a discovery call, that first little step! You can book one at www.calendly.com/simon-bulteel and we can have a video or telephone call to suit you or you can just pick up the phone and call me on 01424 225345. Why not make one of your 2022 resolutions to call us and see how we can help you get a nice pot of money back in your bank account from a successful R&D Tax Credits claim?
www.charteredone.co.uk
ISSUE 31 Winter 2021
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Professional Services | Financial
How Employee Share Ownership Is the Spur to Economic Growth and Lower Taxation David Craddock is a recognised authority in the UK and worldwide on employee share schemes and the author of Tolley’s Guide to Employee Share Schemes. In this article, David identifies the role that employee share schemes can fulfil in making a significant contribution to economic growth while at the same time guarding against excessive tax rates.
T
he Track Record of Employee Share Ownership
Since the introduction in the UK of the first taxapproved employee share scheme in 1978 - the profitsharing employee share scheme, at the behest of the Lib-Lab Pact – the subject of employee share ownership has enjoyed cross-party support in the British Parliament. In a curious way, it appeals to the political ideologies of all the major political parties and persuasions. Yet despite this general political consensus employee share ownership has a very precise functional identity within British companies of all sizes which is to deliver individual reward via team effort and company-wide commercial success, an approach that appeals to the human spirit as a matter of enlightened self-interest, aligning the employee’s interest with existing shareholders around the unifying totem of the developing share value. The evidence to support that this principle works in practice is formidable. It ranges from the significant body of work produced over the decades by Rutgers University in the USA to the more recent studies of consequence undertaken by Cass Business School in conjunction with the British Government Department for Business, Innovation and Skills. Add to these the many other studies covering some 40 years from an array of prestigious universities and institutes in the UK and the USA together with numerous case study examples drawn from companies that have embraced the subject, and the overall picture emerges that, when applied with proper communication and proper implementation, employee share schemes can produce outstanding commercial results.
The Linkage of Employee Share Schemes to Tax Policy and Commercial Intent The attraction of employee share schemes to businesses and their advisors has always been in the first instance through the inclusion of tax reliefs and exemptions for employee share schemes by successive Chancellors of the Exchequer in their Budget Day speeches. Although it is the tax bait that draws the attention to employee share schemes, the companies that succeed in maximising the potential of employee share schemes in their businesses are those whose directors embrace the employee share ownership ethic of employee involvement and participation through the introduction of compatible sister policies. For example, a company may choose to introduce a cash profit-sharing scheme or give emphasis to employee training and development or establish quality circle type forums and committees for employee consultation or utilise the performance review process for the proactive employee buy-in of key corporate objectives. The irony is that if a company chooses to restrict the focus to the tax bait, then that measure alone will not guarantee the success of the employee share scheme initiative, valuable though the tax reliefs are in giving quantum to the employee reward and incentive and providing the first attraction for the company to the subject. The point is that it is in embracing the full commercial substance of the impact that employee share schemes have on the inner inventive qualities of the human spirit that the company benefits from the encouragement of the entrepreneurial spirit within its workforce. www.charteredone.co.uk
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LSCA Business Professional Services | Financial
The Opening Up of the Tax Debate The question arises: why impose taxes upon successful businesses that are contributing with strength to the gross national product, whose trade is enabling other businesses that are in their orbit to thrive also and enabling employees from their own businesses and others to receive just rewards from their employing companies? In other words, surely the intuitive response is to encourage more of the same success which can only be hampered by punitive tax burdens. By increasing their disposable income employees are better able to take charge of their own lives and those of their families, thereby in time lessening the burdens on the state in the provision of health care and social benefits. There are indeed ample studies that support the position that the healthier families live in the more prosperous areas. There must be a move towards this policy. Furthermore, the increased tax burden on companies that arises through corporate taxes leads to undermining the country’s competitive position with its international competitors, notably China and other supplier nations in the Far East, ultimately leading to an increase in unemployment as internal investment is sacrificed through a diversion of funds to pay the corporate taxes. In this scenario, for those employees who retain their jobs, either 10
their wage increases fail to keep up with inflation or, alternatively, excessive wage demands create a cost-push inflation of its own. A policy of not levying excessive taxes, maintaining the buoyancy of the economy, and upholding the dignity of both work and the worker generates a spiral of everincreasing success for the nation, as opposed to the “tax-and-spend” spiral of the 1960s and 1970s in the UK that was demonstrated to produce everincreasing decline in production and in competitiveness. The State of Texas as a Case Study in Financial Management So on to examine a government that operates without state income taxes. The state of Texas in the USA, from which important lessons can be learnt, appears to thrive while at
the same time balancing its budget without any form of state income tax. In broad terms, the state is funded by a combination of federal funding and sales taxes. The federal monies contribute to the funding of Medicaid and Medicare, education, and transportation costs. While the revenues from sales taxes are typically regarded in economic theory as a regressive tax that affects the poorest people the worst, if there is no burden of a state income tax then employees have higher disposable income anyway, free to spend or save or give as they choose. Additionally, the Texas state government receives revenues from lottery proceeds, income from state lands, and returns on its own investments that have been carefully managed for decades, thereby positioning the state government as an astute market player in its own right, operating in the interest of its citizens, minimising the dependency culture often associated with European governments and allowing businesses to allocate their profits between reinvestment and rewarding their employees. Any additional financial requirements are funded by local government authorities through a local sales tax of up to 2% and property taxes, recognising that in a democracy fund raising powers are best decided and exercised at the unit level closest to the citizens. The Nature of Wealth Creation and the Employee Ownership Culture The imposition of excessive taxes assumes that wealth creation is a zerosum game based on the distribution of finite resources. Yet in practice wealth creation is anything but a zero-sum game. The human species has been endowed with a mind that has the capacity to produce an infinite blend of ideas that can apply both art and science to the formation of a business and the generation of wealth. The testimony of history is that new inventions and new discoveries are always there waiting to be unearthed, each with its own wealth generating capacity in the provision of goods and services. The wonder of employee share ownership, when introduced
Professional Services | Financial
business environment for employee share ownership to thrive in, given the renowned capability of employee share schemes, when properly introduced, to provide the incentive for an increase in productivity, the containment of inflation as wage increases are matched by productivity increases and the developing ethos of an incentive economy with capital returns delivering to employees their true return on their business endeavours. The impact of employee share ownership, properly implemented, on total tax revenues will more than compensate for the fall in tax rates.
alongside the wider ownership ethic and supported by compatible sister policies, is that it ignites both the rights and responsibilities that are bestowed upon humans to produce their best in the furtherance of their own well-being and the betterment of their families. Wealth creation is absolutely core to the progression of life of the human species, central to the development of character and the capacity to accept the responsibility. Employee share ownership, properly implemented and maximised for its business potential, ignites personal responsibility in the employee to create wealth in the interest of both individual return and overall business success. The Role of Employee Share Ownership in the Economic Growth Dynamic of Lower Taxation The American economist, Art Laffer, contended that if tax rates increase
beyond a certain level, then total tax revenues fall. The reason is that higher tax rates discourage people from working. The implication of the socalled Laffer Curve is that cutting tax rates could lead to an increase in tax revenues. The theory is predicated on recognition that the extremities are: (1) if the tax rate is 0% then tax revenues are zero and (2) if the tax rate is 100% then the purpose of working becomes redundant and again tax revenues are zero. The question that arises, therefore, is to determine the optimum tax rate. So, if tax rates are too high then a reduction will create the incentive for companies to expand their productive capacity, seek out new markets, increase the size of the workforce with new employment opportunities and become more competitive at home and in the export market. On top of all that, existing employees will be incentivised to work longer hours! What an ideal
David Craddock has been advising on employee share schemes and employee share trust arrangements for over 35 years. He advises on every aspect of the implementation process, working personally with the client at each stage, and offering solutions and expertise in all the technical questions that require clarification during the consultation. As an expert share valuer, David is the Technical Secretary and Advisor to the Share Valuation Worked Examples Group that meets quarterly with HMRC. He is also a member of the Steering Committee of The ESOP Centre, Economics Policy Adviser to The Employee Shares Policy Forum and the Educational Director of The ESOP Institute. DAVID CRADDOCK, MA(Oxon) David Craddock Consultancy Services
David Craddock welcomes an opportunity to discuss your Employee Share Schemes Initiative with you. Please feel free to contact David at: T: 01782 519925 | M: 07831 572615 E-mail: d.craddock@dcconsultancyservices.com Visit: www.davidcraddock.com David Craddock Consultancy Services Specialist in Employee Share Ownership and Reward Management, Share Valuation, Management Buyouts, Employee Ownership Trusts (EOTs) and Investment Education
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LSCA Business
Social Care Levy and State Pension Lock An employee annual salary of
£30,000 Will pay an additional
£255pa with employer contributions increasing by
£265
An employee annual salary of
£50,000 Will pay an additional
£505pa with employer contributions increasing by
£515 An employee annual salary of
£80,000 Will pay an additional
£808pa with employer contributions increasing by
£818 12
Following recent speculation that National Insurance rates would be increased, the Government has now announced that a new Health and Social Care Levy will be introduced from April 2022, expected to boost funding for the NHS and social care by £36 billion over the next three years (although this is not formally ring-fenced). The 1.25% rise will initially be introduced as a rise in National Insurance for all working-age employees, employers and the self-employed, subject to the existing threshold levels. Dividend tax rates will also increase by 1.25% to help fund the package. The dividend tax will be legislated in the next Finance Bill and the government said that additional and higher rate taxpayers are expected to contribute over 70% of the revenue from this increase in 2022-23. From April 2023 it will be treated as a separate tax and will then also apply to those workers above state pension age. It was also announced that from October 2023, there will be a lifetime cap on care costs of £86,000, although not applicable to people already within the care system. Example An employee with an annual salary of £30,000 will pay an additional £255 per annum, with employer contributions increasing by £265. At £50,000 this becomes an increase of £505 for employees and £515 for employers, and at £80,000, £808 for employees and £818 for employers. A white paper on integrated health and social care will be released later this year setting out more detailed plans. The government has confirmed that the state pension will rise by 2.5% from April 2022, breaking the pension lock as a result of the impact of the pandemic.
Mark Kearsley
At present, the state pension is supposed to increase each year in line with whichever of the following is highest: • inflation (CPI) • the average wage increase • or 2.5% During the Covid pandemic, many people were earning less than usual due to the operation of the furlough scheme. As people have returned to full pay, this has been recorded as a large rise in average earnings, estimated 8% from May to July 2021. Under the existing triple lock rules, state pension would need to rise by a similar amount. For 2022/23 only, it will ensure the basic and new state pensions increase by 2.5% or in line with inflation, which is expected to be the higher figure this year. The lock will then be restored for the remainder of Parliament. In addition to those receiving basic and new state pensions, this will apply to those receiving standard minimum guarantee in pension credit and widows’ and widowers’ benefits in industrial death benefit.
LSCA Business
Redrow founder keynote speaker at latest DSG sponsored IoD event Philanthropist and housing developer Steve Morgan addressed a packed audience at the latest in the series of Institute of Directors’ (IoD) events sponsored by DSG Chartered Accountants (DSG). Over the course of the year, DSG is a lead sponsor at events across the region, including breakfast meetings, debates, and the organisation’s regional conference in Liverpool in November. DSG will host its own event later in the year, with details to be confirmed in due course. The event with Mr Morgan was the second since DSG took on the sponsorship, having previously welcomed Metro Mayors Steve Rotheram and Andy Burnham for a questionand-answer session at ACC Liverpool. The former Wolverhampton Wanderers FC owner and Redrow chairman gave delegates an overview of his career, outlining his journey from founding the housebuilding firm to his decision to step away in 2000.
He returned to the company in 2009 and changed the fortunes of Redrow, moving it away from dramatic losses and staff cuts to pre-tax profits and a rejuvenated headcount. In a question-and-answer session with IoD chair David Wafer, Mr Morgan outlined his most admired entrepreneurs, love for Liverpool FC and how the Steve Morgan Foundation – established in 2001 – has supported thousands of people across the UK. The IoD is the representative body of business leaders across the UK. Established in 1903, the group holds a series of networking and discussion events throughout the year. Mark Kearsley, tax partner at DSG and IoD member, said: “It was great to hear from Steve Morgan at this excellent event held by the IoD. “Steve’s contribution to our city is second to none and it was an excellent opportunity to recognise his achievements. “The IoD is a prestigious organisation within the business community and we’re delighted to be partnered with them throughout the next year as one of the region’s largest independent advisory practices.” www.charteredone.co.uk
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North West businesses optimistic following challenges of 2021 Healthy sales and investment outlook despite labour market challenges The ICAEW’s Business Confidence MonitorTM (BCM) for Q4 2021 found that business confidence in the North West remains firmly in positive territory, despite the present labour market challenges. Domestic sales and exports have grown whilst customer demand remains a growing challenge. Domestic sales are 3.2% higher year-on-year in Q4 2021 which is in line with the national average. Exports have also recovered, rising by 1.9% over the last year, which slightly outpaces the national rate. And businesses anticipate much stronger rates of growth in the year ahead, as the recovery gains more impetus. Associated with the healthier demand environment, businesses have started to increase their headcounts. Year-on-year employment growth in Q4 2021 stands at 1.6%. A further 3.0% increase is planned for the year ahead, a near record rate for the region. In conjunction with this, staff development budgets are expected to rise at a similar pace to employment. And as the labour market recovers, so too should average total salary growth. After barely changing during the pandemic, companies plan a 2.9% increase over the coming year.
Q4
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Business challenges Businesses may also be planning to increase salaries to tackle some of the issues that they are dealing with in the labour market. Labour shortages are apparent as many companies try to recruit staff at the same time. Consequently, the availability of management and non-management skills have surged as growing challenges in the year to Q4 2021, with the former cited by 26% of companies and the latter by 38%. Both are record rates for the region since the survey began in 2004. Difficulties in recruitment are also reflected in staff turnover as a growing source of difficulty for 43% of businesses. This is also a record high for the region. Beyond labour market challenges, transport problems are also widespread, and a more pressing issue for 34% of companies. This is the joint highest rate since the survey began and probably reflects freight capacity constraints as demand surges, including a shortage of HGV drivers. It is also possible that businesses have had difficulties in adjusting to new Brexit-related procedures and border controls. Adding to these obstacles, regulatory requirements are more widely cited in the region as a growing challenge than elsewhere in the UK. Again, Brexit may be part of the explanation here. It is clear that there are still some significant challenges ahead, however businesses in the North West are well placed to capitalize and achieve substantial growth over the next year or so. We have fantastic breadth of expertise in the region around fintech, digital and manufacturing and it is time for the North West to take the lead and make levelling up happen.
LSCA Business
ICAEW and CIPFA exploring potential for closer working The vision driving the discussions would see ICAEW and CIPFA sharing a common strategy, under which CIPFA would continue to have a differentiated market presence, a distinctive membership and dedicated specialist staff. The aim would be to combine the strengths and resources of ICAEW and CIPFA in a way which better equips them to serve the public interest across all areas of economic activity, including the enterprise, public and third sectors.
The vision driving the discussions would see ICAEW and CIPFA sharing a common strategy, under which CIPFA would continue to have a differentiated market presence, a distinctive membership and dedicated specialist staff. " ICAEW and CIPFA Michael Izza, the CEO of the ICAEW had some interesting news for us last week. “The President and I briefed our Council that talks are under way between ICAEW and the Chartered Institute of Public Finance and Accountancy (CIPFA) to explore closer working between the two bodies. By a large majority Council agreed that this potential relationship with CIPFA could support and accelerate our Strategy, and that detailed discussions should now take place with a view to bringing forward formal proposals early next year. +44 (0)1908 248 250
Any outcome to these discussions will be subject to approval within the Institutes, as appropriate and necessary under their respective governance requirements, and by key external stakeholders such as the UK Government, the Privy Council and regulators. I will of course keep ICAEW members updated on the discussions with CIPFA as they progress. In the meantime, let me take this opportunity to send you season's greetings and wish you a happy New Year.”
contactus@icaew.com
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ISSUE 31 Winter 2021
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Five ways to boost your accountancy business post-lockdown As we start to look to the future and transition to a post-lockdown mindset, many accounting and bookkeeping firms are looking at ways to take their business to the next level by streamlining their workflow and becoming more efficient.
Here are five ways you can kick-start your business now, to bring success post-lockdown: Get organised Eliminating paper from your office and shifting to secure online storage is not enough – you will still face issues searching for documents if your file structure is unorganised. Make sure your storage solution has customisable folder structures so you can route documents to their final destination and file them automatically. This will make searching for specific documents far easier.
Create repeatable workflows Set up automatic notifications, create templates, and establish a centralised location for all of your client information and important document. Integrating tools like DocuSign into your workflow and setting up custom templates to suit your business’ needs saves tremendous amounts of time. For example, you can simply send out a form for signature with one click, have it routed back to the correct folder, and instantly receive a notification that a document has been signed.
Add a client portal to your website A client portal allows you, your staff and your clients to access important documents securely at any time, regardless of location. It also allows clients to send you sensitive information securely and quickly over the internet. Don’t lose valuable time because a file exists on one machine that might be temporarily inaccessible, or even worse, lost or stolen.
Integrate your softwareEnsure the platforms you use every day communicate with each other, and avoid having to work in silos based on the software you need at that moment in time. SmartVault integrates with TaxCalc, Xero, Quickbooks and more – plus you can connect virtually any app you use to SmartVault via our print driver integration.
Set up 2-Factor Authentication (2FA) This may not save you time immediately, however turning on 2FA reduces the risk of cyberattack by 99% - this could save you a lot of time (and money) if your computer or email was hacked and sensitive information was inadvertently disclosed. Any apps that store or process sensitive information should have the option to turn on 2FA – and if they don’t, they should!
Find out more about how Smartvault can help you kick-start your business smartvault.com/see-a-demo
Rated #1 secure file sharing & document storage for accountants Streamline the way you collect source documents, organise client data and share files by using a secure, branded client portal, built for accountants and accounting firms.
In-built security and compliance SmartVault keeps you GDPR and AML compliant, with bank-grade encryption both at rest and in-transit.
Unlimited growth Add unlimited clients (for free!) and never experience a degraded service (common with on-premise storage) as you add clients & documents.
Automatic back-ups You never have to worry about losing your laptop or your hard drive failing with cloud storage - we automatically back up files as soon as they are uploaded.
Automate your workflow From collecting files from clients to eSigning within the portal and automatic filing, SmartVault helps you reach peak efficiency in as few clicks as possible.
I wouldn’t use anything else. Possibly the most seamless cloud-based solution for accountants. Christos Liondaris | Accountant and Founder | Liondaris & Co
SmartVault helps over 20,000 accountants and businesses securely share files with over 1,000,000 clients every day. Take 15-minutes to see how we can help your practice.
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LSCA Business
GENTLEMEN I GIVE YOU...
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LSCA Business
Hello again Chartered ONE readers, roars our very own Chris Wainwright. I have been a regular contributor over the last years and your Editor, Martyn has given me yet another opportunity. Maybe he is hoping I will come up with something interesting this time. Over the years I have submitted accounts of my (lamentable) efforts to complete the London marathon, swim the Mersey and cycle for charity. Recently I have diverted my charitable efforts to the computer and I have written a book. I have actually done this before but never published. I used to sit down and write, not often and generally in the middle of the night and any school teachers would go mad at me: I never made a plan! Like all those past efforts I was ready to consign this latest effort to an aging hard drive somewhere when Martyn read it. He liked it and he insisted that I publish it! I couldn’t face this so he did it for me. Thank you, Martyn – and we wouldn’t now be raising money for charity had you left me in peace with my under achieving. BUT – what’s the book, and what’s the lucky charity? The book is called ‘Gentlemen I give you’ and is about yes, gentlemen I have met over the last 30 years and more often than not following an introduction from Andy Pritchard formerly of Arthur Young. He left AY/EY to take up a serious role at Iceland Frozen Foods retiring very comfortably, far too young and far too early a few years ago. The inspiration for the book finally came to me at a lunch one day when guests to said lunch were getting their copies of Malcom Walker’s book ‘Best Served Cold’ signed by the great man himself.
This formed the main strand of the book together with some Ronnie Corbet like ramblings off on tangents. Seriously though, folks – the heroes of the book are some fine professionals and business people who have helped restore the fortunes of our city since the low point of the 1980’s and who have left a lasting legacy.
“The inspiration for the book finally came to me at a lunch one day when guests to said lunch were getting their copies of Malcom Walker’s book ‘Best Served Cold’ signed by the great man himself. ” As to the chosen charity, as a former rugby player I was very touched when former Scotland and British Lions rugby union legend Doddie Weir announced his MND diagnosis. His pal, my cousin Rob Wainwirght, also an international and a Lion almost immediately started raising funds for research into this ghastly disease. From the day I saw Doddie on Sports Personality of the Year unable to take the Helen Rollason award from Princess Anne we decided that the profits would all go to the big man’s charity. Some of you will already have bought the book, but if any more can help then the link is: www.chriswainwrightbooks.com Thank you for listening, err, reading and err, contributing. PS – I have been told that I will be the subject of the new Chartered ONE BIG interview in the next issue.
The whole gathering consisted of other successful business people, and me too (though not very sure why I had actually been invited), and the thought occurred to me that I should spend a little time with each of them and record the results.
www.charteredone.co.uk
ISSUE 31 Winter 2021
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LSCA Business
Liverpool Society of Chartered Accountants – Equality, Diversity and Inclusion
ICAEW workshop 12th October 21 Barbara Boyle (LSCA ED&I Champion) attended an ICAEW workshop held at the Bishopsgate Institute, London with about 30 other participant volunteers from across the country. The volunteers had abroad spectrum of backgrounds and expertise from the accountancy profession. It was an experiential and innovative day supported by facilitators together with a small group of actors who performed a number of thought provoking role plays. The event was filmed and a series of short video clips will be available to be used as learning material by ICAEW members.
If you need ED&I help or advice or wish to share ideas, please contact Barbara Boyle via her Linkedin page:
https://www.linkedin.com/in/barbara-boyle/
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LSCA Business
ICAEW North West Regional programme of events January – March 2022 All ICAEW events across the North West Region currently take place via Zoom unless stated otherwise. Registration for all events is available online www.icaew.com/events DATE
EVENT
03-Feb-22
North West Practice Members' Network
04-Feb-22
Learning to Lead: Speaking Up
08-Feb-22
Update on the latest regional cybercrime trends with NWCRC
09-Feb-22
Modern Slavery
10-Feb-22
Inclusive Leadership
10-Feb-22
Harnessing the power of data analytics
16-Feb-22
Managing Fraud
22-Feb-22
Business Support Schemes in the Cumbria LEP area
24-Feb-22
Creating agile supply chains
01-Mar-22
Corporate disclosure post COP 26 – can accountants help save the World?!
02-Mar-22
NW Charity Sector Insight Group
03-Mar-22
ICAEW North West Q1 BCM
04-Mar-22
Learning to Lead: Speaking Up (Women in Leadership)
09-Mar-22
Practice Assurance update (AML / PII / Client Money etc) including DPB (Designated Professional Body)
10-Mar-22
Design and tax structuring for the MBO
15-Mar-22
Don't upset the tax man - VAT guidance for UK importers and exporters
17-Mar-22
North West Practice Members' Network
23-Mar-22
ICAEW North West Business Network
24-Mar-22
Employment Taxes Update
All of these events and more can be found at www.icaew.com/events
Essentials CPD The 2021 programme is now well underway and we would appreciate your support in sharing this with your colleagues.
https://events.icaew.com/pd/19212/ essentials-virtual-cpd-2021-programme?sourc e=search&txt=brexit&rid=232
Member insight Please share your member insight with the local regional team, your views are important and will be fed back through the ICAEW network.
www.charteredone.co.uk
ISSUE 31 Winter 2021
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LSCA Business
Nigel Lanceley is not only one of our longest standing members of the Society, having qualified in 1972, but he is a truly fascinating character. He is also a long-standing member of Royal Liverpool Golf Club and the chairman of two leading Liverpool-based charities, North West Cancer Research and Local Solutions and earlier this year he succeeded retired Judge John Roberts in the prestigious role, following his selection by the Queen in her capacity as the Duke of Lancaster. After leaving the profession he joined Rensburg Sheppards from 1975 – now part of the Investec Group –until his retirement in 2016, becoming Senior Regional Director, and Group Compliance Officer.
“So, Nigel, it’s a true pleasure to meet with you, and to start with, how did you become the High Sherriff?” “Martyn, it’s a pleasure to meet you too, and I’m delighted to be the first person to be featured in this new section.
The Chartered ONE BIG interview We are starting a new section with our Editor Martyn Best combing the area to meet some fascinating members of our Society who have achieved something special beyond their Chartered Accountant qualification. He starts this new series with meeting Govier, Client upLisawith ourDirector High Sherriff of Merseyside. 22
“Well, I’ve been a Deputy Lieutenant since 2016, and have always enjoyed the public service element of that role, and becoming really engaged with many local issues, especially in the areas of addressing and combatting issues such as violence against women, and supporting young people. The appointment isn’t overly covered in secrecy, but one interesting element having been nominated and then appointed by Her Majesty is the wording that Her Majesty “doesn’t disapprove you”. I must have been lucky here, and it is such a great honour to continue the excellent work of my predecessors in this prestigious role.
“So, what are your key aims during your year?” “As I said, my personal passion is to help young people, and I have been supporting a wonderful initiative called “Children Heard & Seen” which supports young people who have a parent in prison. This charity aims to help the 300,000 such children in this position.
LSCA Business
“I have also developed a personal message of “We care, you matter”, and have also been supporting the Merseyside Violence Reduction Unit. “In a more general outlook, the principal objectives of the role of High Sheriff include ensuring the welfare of visiting High Court judges, supporting the Royal Family, judges, police and other law enforcement agencies, the emergency services, local authorities, church and faith groups.”
“I see that you also have some very interesting and diverse hobbies, and also share my own love of cycling.” “Well, yes, you could say that. In 2012, I was part of a team that raised over £24,000 for local charities by cycling from John O’Groats to Lands End alongside Royal Liverpool’s former Secretary, Chris Moore. “I’ve been very lucky in being able to follow the other sporting interest I have of golf – most notably due to Libby my wife also having that same interest. We met through golf in 1973 and we’ve had a great association with both Royal Liverpool and Caldy.” “2012 was a very enjoyable year, as I was also one of the Olympic Games Makers” I think my adventurous streak began very early on, having been born in Kenya, where my father, an Army doctor, was posted after the Second World War. I was very lucky to meet Libby and now have three grown up children, Clare, Stuart and Zoe, and three grandchildren. We’ve had some great adventures trekking, hiking, skiing
and snowshoeing and have explored various remote areas of the world.”
I’ve been a Deputy Lieutenant since 2016, and have always enjoyed the public service element of that role, and becoming really engaged with many local issues, especially in the areas of addressing and combatting issues such as violence against women, and supporting young people."
“Of course, you had a great career start” “Indeed (with a hearty chuckle) – and I’d always advocate accountancy as not just a fine career, but also a good foundation for other avenues. I still retain great friendships with some of the Liverpool Society Past Presidents in Jonathan Mounsey, Mike Cox and Trevor Leary. “I was educated at Rock Ferry Convent, Kingsmead School and Stonyhurst College, and on leaving school I took up articles in Chalmers Impey a firm of Chartered Accountants in Liverpool, and then with Blease Lloyd, before moving to Rensburg and Co stockbrokers and overseeing some amazing changes and growth there. The time at Rensburgs and then Investec really highlighted the value of an accounting qualification.
My personal passion is to help young people, and I have been supporting a wonderful initiative called “Children Heard & Seen” which supports young people who have a parent in prison. This charity aims to help the 300,000 such children in this position." “Nigel, thanks for sharing this with our members, and our very best wishes for the rest of your year, and of course, take good care of that hugely impressive sword.”
www.charteredone.co.uk
ISSUE 31 Winter 2021
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ESSENTIALS CPD 2022 PROGRAMME PREMIUM COURSES, TECHNICAL KNOW-HOW
icaew.com/essentialscpd
LSCA Business
How lockdown changed my life J
an McArd, our Past President discusses the personal impact of Lockdown, and how it wasn’t such a bad thing, and she provides us with some great Christmas health and fitness tips. Many of you may know that I like to do a bit of running. Nothing too exceptional compared to some runners I know but having started running July 2015 (when I was dragged from lamppost to lamppost and usually ended up looking like a dishevelled Ribena berry) I have found myself Ladies Captain of Wallasey AC with a club place in the London Marathon in October 2022. Lockdown was kind to me as it gave me plenty more time to run (with my husband, with another runner, or in a small group depending on the rules at the time) and increase my weekly distance. With that came minor niggles – you can’t call yourself a runner unless you are carrying an injury – but nothing too serious. But lockdown also brought the opportunity to do more home cooking. Whilst I never considered myself a fantastic cook – up until then I had never baked in my life but since March 2020 the house has been filled with soda bread, banana bread, and chocolate muffins amongst many other tasty things. As well as the fine dining experience Chez McArd, there was an increased wine and cocktail selection – running those extra miles I deserved it didn’t I?
Christmas Tip #1 Eat until satisfied, not stuffed. That way you will enjoy your food so much more and look forward to the next meal.
And so the cycle of run / reward / repeat began, but soon the rewards became disproportionate to the amount of exercise and I soon found myself feeling sluggish and slowly piling a few extra pounds on. Fearing the inevitable middle-aged spread, I sought advice from the experts
Christmas Tip #3 Think about your food environment. Having chocolates, crisps and other yummy festive snacks visible and close by means that you are more likely to eat more of them. Still enjoy them if you wish (it is Christmas after all) but put them out of sight afterwards
With the help of www.trainer-jane.co.uk I started work on my core strength with a weekly strength band class, as well as following a healthy eating lifestyle plan. No diets, or counting calories, just sensible advice and goal setting around food and drink which has led to a mindset change and positive results. And I have seen the benefits of feeling fitter, feeling healthier and running faster. In October 2021 I was 3rd placed lady in the Wirral 10k, knocking 6 minutes off my previous 10k personal best. So as the Christmas season is already upon us, I thought I’d share a couple of things that I will be following over the holiday break to ensure I will be in top notch condition to face those January tax return deadlines.
Christmas Tip #2 Keep some of your healthy habits (like drinking enough water each day) ticking along, it will make it so much easier to get back on track after the festive period
Christmas Tip #4 Include lots of the good stuff. Christmas is a great opportunity to boost your intake of delicious seasonal veggies that you might not usually eat such as brussels sprouts, turnips, parsnips red cabbage and swede. Christmas Tip #5 Enjoy your Christmas food. Christmas can be a stressful time at the best of times for many people. The last thing we should be worrying about is the calories in our Christmas food. No guilt, no stress, just savour and enjoy but remember to keep your goals in mind. I’m off to have a mince pie and a snowball now so very best wishes to you and yours for Christmas and 2022. www.charteredone.co.uk
ISSUE 31 Winter 2021
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Do people really want tax cuts if that means poorer public services?
Andrew Lloyd, LSCA Past President and Tax Partner at RSM, considers the signals being sent out by the Chancellor of the Exchequer over his future tax plans. Having weathered the storms whipped up when he broke key tax commitments from the Conservative party’s 2019 manifesto, it is hardly surprising that the Chancellor is signalling now which taxes he plans to cut, and by how much, before the 2024 election.
the abolition of the 45 per cent top rate of income tax.
Three possibilities are being talked about.
At one level this makes perfect sense. The tactic holds out the prospect of jam tomorrow for an electorate which is weary of restrictions and hardships, and hungry for some good news. More specifically, it may mollify voters whose trust has been shaken by a range of unforced errors and
First, a 1 per cent cut in the basic rate of income tax to 19 per cent in 2023/24, followed by a further 1 per cent cut to 18 per cent in 2024/25. This might even be accompanied by
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Second, an increase in the inheritance tax threshold. Third, a reduction in VAT on energy from renewable sources.
LSCA Business
unwelcome headlines from sleaze to Downing Street parties. That might also mitigate the damage at forthcoming by-elections. However, while these proposals are easy to present, they risk creating problems of their own. For example,
having added to the tax burdens of workers by imposing the health and social care levy, the Chancellor is likely to receive sharp criticism if he goes on to reduce income taxes in a way which leaves lower-paid workers worse off overall, but higher-rate taxpayers and investors better off.
rate income tax threshold up to and including 2025/26. In the two years for which the Chancellor is holding out the prospect of tax cuts, that freeze will bring in more than £17 billion to the Treasury. Third, the increase in corporation tax rates will yield an extra £28 billion in those two years.
With economic growth unlikely to fill the gap for the Chancellor, he will also be challenged to answer the obvious question: how will the tax cuts be paid for? We’re talking big numbers here. Cutting 2p off the basic rate of income tax would cost £12 billion. Looking back over recent Conservative budgets, Treasury figures point to only three tax changes which might raise that sort of money by the end of this Parliament.
Unless they are funded by borrowing, the tax cuts will therefore be paid for either by bigger tax bills for companies or by the Treasury paying back extra taxes generated from frozen allowances and thresholds. Money with your name on it, as the saying goes.
First, the health and social care levy. That can be disregarded as it will be ring-fenced to achieve its stated purpose. Next is the freeze on personal allowances and the higher
UK taxes may have reached a historic high, but many voters recognise that the amounts they pay are still not sufficient to fix the roads, reform the NHS, sort out policing, get education back on track and address the climate emergency. If the Chancellor is hoping that in 2024 people will accept a modest tax cut instead of proper services, he is taking a huge gamble.
www.charteredone.co.uk
ISSUE 31 Winter 2021
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LSCA Business
New innovations and greater client choice in global stock markets
W
ith global stocks reaching
Exchanges have been created
new highs and new regulated
that offer the issuance, trade and
exchanges entering the
management of decentralised derivative
market, Neil Blankstone explores
assets such as cryptocurrencies like
the latest developments and client
Ethereum or Bitcoin, facilitating a space
offerings within an ever-changing
for the creation and settlement of
landscape.
synthetic assets. There is concern that
The impact of COVID-19 has clearly
such assets are not yet ready for the
created huge challenges for economies
mainstream with regulatory bodies such
large and small, with the real-world
as the FCA warning of the risks.
consequences felt by businesses across
Consequently, if this is a bit ‘too
the globe.
innovative’ then IPSX as a further
During this time however, new
example is a lot more ‘grounded’.
listings on global stock exchanges have
Specialising in real estate, IPSX
continued to reach new highs, and
enables asset owners to raise capital,
market capitalisation figures from Tokyo
and investors to invest in real estate
to New York to London have seen solid
through a regulated exchange. For
growth. The wider capital markets have
example, the Mailbox in Birmingham – a
undoubtedly been a critical source of
large prime office-led mixed-use asset
support in facilitating new financing
– is on the exchange as Mailbox REIT
when it has been most needed in the
plc and allows investors exposure to the
last 18 months.
long-term income streams. Investors
Stock exchanges therefore continue
are attracted to assets where income
to play their part, enabling access to
is derived from well-known long-term
investors seeking better returns in a low
tenants, and they can see it with their
interest environment.
own eyes, even take a drive past in the
New products and services, more
car if they wish!
choice.
We have also seen other innovations,
Since the formation of the Alternative
including the explosion of money market
Investment Market in 1995 there has
funds offered, again expanding choice
been a recognition that innovation,
for investors seeking to park their cash.
flexibility, and a focus on the needs of
The International Stock Exchange
smaller, more specialised, businesses
(TISE) has also innovated in recent
can create new opportunities to
years, with updates to their listing
match investors with those in need of
rules and changes to the application
investment.
process. TISE have taken a good slice
In recent years there have been
of the global trend for increased public
further innovations and new regulated
issuance, with the first quarter of 2021
products and services entering the
seeing more new listings than in any
market – once again expanding the pool
other first quarter since the inception of
of investors and businesses benefitting
the Exchange in 1998.
from regulated exchanges.
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NEIL BLANKSTONE of Blankstone Sington
Conclusion The aftermath of the pandemic will likely lead to further innovations and greater client choice – if undertaken within a flexible and agile regulatory regime. Private investors who have not previously engaged with stock exchanges are looking at new regulated markets – IPSX being a prime example. Innovative businesses therefore have more choice when raising finance, which will keep the wheels of the economy greased. The role of specialist investment managers and brokers is also changing. To ensure clients benefit from new opportunities there is a requirement to scan the horizon, reach out, and stay on top of any new innovations, product and services – something Blankstone Sington does very well! Authorised and Regulated by The Financial Conduct Authority (143694). Web:
blankstonesington.co.uk
Tel:
0151 236 8200
LSCA Business
We listen. We plan. We invest. INVESTMENT MANAGEMENT INHERITANCE TAX PORTFOLIO SERVICE STOCKBROKING
Entrusted with our clients’ savings and investments since 1976. BlankstoneSington.co.uk
ISSUE 31 Winter 2021
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LSCA Business
Owners of cryptoassets asked to consider CGT cryptoassets can fluctuate dramatically, and past trends have seen a 65% increase in value in one day and 25% decrease in value in another. Non-UK domiciled individuals HMRC have not issued letters to non-UK domiciled owners of cryptoassets, potentially leading to confusion surrounding the physical location of cryptoassets. In the HMRC manual CRYPTO22600 HMRC considers the situs of a cryptoasset for capital gains tax and inheritance tax purposes and states that “where the cryptoasset is simply a digital representation of an underlying asset then the location of the underlying asset will determine the location of the cryptoasset”.
Kelly Dixon, DSG Owners of cryptoassets asked to consider CGT HMRC has issued letters to owners of cryptoassets asking them to consider their capital gains tax position when dealing with cryptocurrencies online. The nudge letters remind UK taxpayers that the disposal of cryptoassets may lead to a capital gains tax charge, and identifies a “disposal” as: • The sale of cryptoassets for fiat currency (e.g. GBP, USD). • The exchange of one cryptoasset for another. • The use of cryptoassets to buy goods or services. If any of the above transactions result in a capital gain in excess of the taxpayers’ annual allowance (currently £12,300), the gain will be required to be reported to HMRC, usually via a Self-Assessment Tax Return. What are cryptoassets? Also known as cryptocurrency, cryptoassets are a form of electronic cash. They exist in digital format only and can be used to make online payments between users of the assets. There are thousands of different cryptocurrencies in existence, with Bitcoin, Ripple and Ethereum having made recent news headlines. Unlike recognised currency such as sterling, cryptoassets are not managed by a central government bank and carry significant risks. The value of
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In the case of cryptoassets, there is typically no underlying asset, and in this case none of the statutory rules in TCGA 1992 apply. Alternatively, HMRC take the view that: • exchange tokens have an economic value as they can be ‘turned to account’ - for example, exchanging them for goods, services, fiat currency or other tokens; • exchange tokens are a new type of intangible asset (different to other types of intangible assets, such as shares or debentures); and • the only identifiable party to consider is the beneficial owner of the exchange token “such that the location of the cryptoasset will be determined by the residency of the beneficial owner” In conclusion, a UK resident individual will always be liable to capital gains tax on the sale of cryptoassets if they are the beneficial owner, regardless of their place of domicile.
Also known as cryptocurrency, cryptoassets are a form of electronic cash. They exist in digital format only and can be used to make online payments between users of the assets.
O
0330 133 3732
northernlegalalliance.co.uk
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n Risk & Compliance: We will remove the headache of managing risk and the compliance minefield with a simple framework n Client Service: We will support you to improve the service that you provide to clients and then benefit from the marketing opportunities from meeting our service standards n Training: We will offer you and your staff a training platform that will link into our other services such as our Quality Mark. n Seminars and Conference: You and your staff will receive free entrance to all of our events which will include our annual conference n Social and responsibility: Enjoy and contribute to our social calendar. Not only will we add some fun to the network but make a difference by supporting local charities
Contact Andrew Byrne Director (and Solicitor) on 07549 238677 or andrew@northernlegalalliance.co.uk Northern Legal Alliance is a trading style of Jackson Lewis Limited – Registered Company No.11192540. Jackson Lewis Limited is a private limited company. For the list of directors, contact us at: Rodney Chambers, 40 Rodney Street, Liverpool L1 9AA | T: 0330 133 3732. | ICO Data Protection: ZA453510
LSCA Business
Liverpool Society of Chartered Accountants celebrate newly-qualified accountancy talent Over 20 young professionals from the Liverpool City Region celebrated becoming exam qualified Chartered Accountants at a special ceremony in October hosted by ICAEW - the Institute of Chartered Accountants in England and Wales. The initiative is designed to mark exam success, welcome new chartered accountants into membership and prepare them for the next steps in their career. The new accountancy professionals met at The Venue in the Royal Liver Building, Liverpool for the special ceremony with family and friends. ICAEW Deputy President, Julia Penny, presented certificates to the group of outstanding candidates and signposted new members to support, opportunities and benefits of building a relationship with ICAEW in their local area. Justin Lang, Deputy President of the Liverpool Society of Chartered Accountants, said: It’s important that we celebrate our trainees success considering not only the challenge of balancing work and study, but also the challenging circumstances that have all found ourselves in this year. Our world-renowned professional qualification is deliberately tough and to have successfully navigated through to qualification is a fantastic achievement. It was a wonderful event, in a fitting location, and I know it will mean a lot to our newly qualified members to mark the occasion by being awarded their “key to the profession” by Julia Penny Deputy President of the ICAEW. It’s a significant milestone in their career and I expect the memory will stay with them for a long time." Nick Sell of RSA said:
On behalf of RSA, congratulations to all these new Chartered Accountants! It’s important that they take a moment to celebrate their success; it’s what today was all about."
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LSCA Business
UK Budget – Autumn 2021 – A Stronger Economy for the British People Personal Tax, Pensions and Employment The National Living Wage will be increased to £9.50 an hour, effective from 1 April 2022, for individuals aged 23 and over. A reduction in the taper rate that applies in Universal Credit from 63% to 55% by 1 December 2021. As previously announced on 7 September 2021, a new 1.25% Health & Social Care levy (the Levy), will be introduced and apply to Class 1 and Class 4 National Insurance Contributions, for both main and additional rates. This will initially be introduced from April 2022 as a rise in National Insurance for all working-age employees, employers and the self-employed. From April 2023, once HMRC’s systems are updated, it will be treated as a separate tax and also apply to the earnings of individuals working above State Pension age. NIC rates will return to their 2021-22 levels. The dividend rates will also be increased by 1.25% from 6th April 2022, making the ordinary rate 8.75%, the upper rate 33.75% and the additional rate 39.75%. The ‘Triple Lock’ for the State Pension has been temporarily suspended, and for 2022-23 only, the increase will be the higher of CPI or 2.5%. 40
Corporate Tax Annual investment allowance of £1m to be extended to March 2023. R&D to be reformed to support modern research methods including data and cloud costs from April 2023. Further details will be announced later in the Autumn. Museums and Galleries Exhibition Tax Relief will be extended until 31 March 2024. From 27 October 2021 the rates of Theatre Tax Relief (TTR), Orchestra Tax Relief (OTR) and Museums and Galleries Exhibition Tax Relief (MGETR) will increase:From 27 October 21, the headline rates for the TTR and MGETR will temporarily increase from 20% (for non-touring productions) and 25% (for touring productions) to 45% and 50%, then reduce to 30% and 35% on 1 April 2023, and expiring on 1 April 2024, returning to 20% and 25%. For MGTER, the relief will expire on 1 April 2024 and no expenditure from this date will be eligible for relief. From 27 October 2021 the rates of Orchestra Tax Relief will increase from 25% to 50%, reducing to 35% from 1 April 2023 and returning to 25% on 1 April 2024.
LSCA Business
Business Rates Eligible retail, hospitality and leisure sectors will be able to claim a 50% discount on their business rates bills up to £110,000. This is for 2022-23. More frequent business rates revaluations to be carried out every three years instead of every five years. A freeze in the business rates multiplier for a second year, from 1 April 2022 until 31 March 2023, keeping the multipliers at 49.9p and 51.2p. There will also be a 100% improvement relief for occupiers where eligible improvements to an existing property increase the rateable value. Property & Capital Gains Tax A new tax will be introduced from April 2022 on profits that companies make from UK residential property development. This will be charged at 4% on profits exceeding an annual allowance of £25 million. The tax is to target building safety remediation. From 27 October 2021, the Capital Gains Tax reporting and payment deadline, after selling UK residential property will increase from 30 days to 60 days after the completion date. This will also include non-UK residents. For mixed-use property disposed of, the 60-day payment window will only include the residential element of the property gain.
Administration From 6 April 2024 income tax basis periods will be reformed so businesses’ profit or loss for a tax year will be the profit or loss arising in the tax year itself regardless of its accounting date. This will remove the need for overlap relief. The transition to the new rules will take place in 2023-24. Making Tax Digital for sole traders and landlords with income over £10,000 will have an extra year to prepare for Making Tax Digital. This will now be introduced from 6 April 2024. General partnerships will not be required to join MTD until 6 April 2025. The new points based system for penalties relating to late submission and late payment of tax for Self-Assessment will now come into effect on 6 April 2024 in line with Marking Tax Digital. Covid support The Recovery Loan Scheme will also be extended until 30 June 2022. Finance will be available up to a maximum of £2 million per business, supporting their recovery and growth following the pandemic.
www.charteredone.co.uk
ISSUE 31 Winter 2021
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LSCA Business
WITH ANDY BOUNDS IT'S TUESDAY EVERY DAY
Each Tuesday, Andy provides us with a gentle tip to improve our business, but did you know that each Christmas his tradition is a brain-teasing quiz, and here it is:
Q3 What English word retains the same pronunciation, even after you take away four of its five letters?
Q1 The more you take, the more you leave behind. What am I?
Q6 What flies when it’s born, lies when it’s alive, and runs when it’s dead?
Q2 What English word has three consecutive double letters?
Q7 What goes back and forth constantly, but never in a straight line?
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Q4 When you have me, you feel like sharing me. But if you do share me, you don’t have me anymore. What am I? Q5 What has a forest but no trees, cities but no people, and rivers but no water?
LSCA Business
Q8 A woman was sitting in her hotel room. There was a knock at the door. She opened it, to see a man who she’d never met before. He said “I’m sorry, my mistake – I thought this was my room”. He then went down the corridor and into the lift.
I hope you enjoyed the quiz.
She went back into her room and phoned security. What made her suspicious of him?
Cheers, Andy
Q9 What common three-letter English verb becomes its own past tense by rearranging its letters?
Q1 Footsteps
Q10 You throw away the outside, eat the inside, and then throw away the inside of that. What am I? Q11 Which word does not belong in the following list – STOP COP MOP CHOP PROP SHOP OR CROP? Q12 If you eat me, then my sender will eat you. What am I? Q13 Name an English word of more than two letters that both begins and ends with the letters ‘HE’ (in that order).
IN HERE ARE THE ANSWERS. How did you get on? Have a wonderful Christmas and New Year.
Q2 Bookkeeper Q3 Queue Q4 A secret Q5 A map Q6 A snowflake Q7 A pendulum
Q14 Where is this possible: when you add three to eleven, and get two?
Q8 You don’t knock on your own hotel door – and the man did
Q15 A farmer owns a pear tree. Her main customer calls, to ask how much fruit is available to buy. The farmer knows that the trunk has 20 branches. Each branch contains exactly 10 boughs, and each bough has exactly 5 twigs. Since each twig bears one piece of fruit, how many plums will the farmer be able to sell?
Q9 Eat and ate
Q16 Two mothers and two daughters are fishing. Between them, they caught a big fish, a small fish, and a fat fish. Since they only caught three fish, how’s it possible they each took home one fish? Q17 How can you physically stand behind your dad, while he is standing behind you? Q18 What side of a cat contains the most hair? Q19 You’re running a race. If you overtake the last person, what position are you in? Q20 What’s unusual about this paragraph? How quickly can you find what’s so odd about it. It looks so ordinary and plain, that you might think nothing’s wrong with it. In fact, nothing is wrong with it! It is curious though. Study it. Think about it. You still may not find anything. But if you work at it a bit, you could just find out.
Q10 Corn on the cob Q11 OR Q12 A fish hook Q13 Headache or heartache Q14 On a clock. When you add three hours to 11 o’clock, you get 2 o’clock Q15 None, you don’t get plums from a pear tree Q16 It’s only three people – a granny, a mother and a daughter. The mother is both a mother to the daughter; and a daughter to the granny! Q17 Stand back to back Q18 The outside Q19 It isn’t possible – you can’t be after the last person… or they wouldn’t be last! Q20 It doesn’t contain the letter ‘e’
You can email him on andy@andybounds.com and join his online sales training programme at www.andyboundsonline.com www.charteredone.co.uk
ISSUE 31 Winter 2021
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Professional Services | Financial
When should a business speak to an insolvency practitioner? A question that is on any businesses owners’ mind when facing financial and operational challenges that threaten the continuity of the business. Many assume that an insolvency practitioner should be contacted at the point the company becomes insolvent, but this is not what we would recommend – it is far more beneficial for an IP to be contacted much earlier.
T
ypically, we have two scenarios when we are contacted. Either the business is having problems and the management are aware of the cause OR, the business is having problems and the management are at a loss of the clear route cause; which is more often the case. Common problems we regularly see are: 1) Battling overdraft facility 2) Arrears in HMRC payments 3) S upplier issues affecting delivery of own products/services 4) Staffing issues e.g. can’t find staff or can’t hold onto staff 5) Balance sheet and/or turnover reduction 6) Client erosion All too often, multiple indicators are showing themselves and with the overwhelming pressures, the management are in the thick of trying to resolve the problems, convinced they can fix them
without external help, often patching up issues rather than implementing longerterm fixes. Current Challenge An insolvency outlook report by Atradius(1) forecasts business failure rates will increase by 10% this year in Britain. External influences and economic change can often be the final blow for a business that has already been struggling. There are many businesses across the UK which have been ‘surviving’ rather than thriving and one small change such as an increase in interest rates can send them over the edge. In light of growing challenges, it is important that companies act with speed if the owners/Directors identify problems in the business; before the challenges become too big. Often, when we are engaged earlier, there are likely to be more options to rescue a
business rather than implement an insolvency process. We want to be working with Stephen Berry, businesses Partner at Opus as early as possible so that we can help them with solutions to recover their business rather than taking them down the insolvency route. This is where we can best support the management team. As well as recommending and implementing known and tried methods to help the business, we have a number of contacts who can help the struggling business if a new viable plan can be identified. For more information about our services, please call us on 0151 705 9115, email liverpool@opusllp.com or visit the website www.opusllp.com.
1. https://www.cityam.com/global-insolvency-rates-tipped-to-reach-10-per-cent-in-the-uk/
RESTRUCTURING & INSOLVENCY
Taking the Stress out of Distress At the point a business is in distress, the business owners and/or Directors need support from people they can trust, that are visible and readily contactable. For your clients, we know that means not only having people who understand the nature of their work, but also the local business market. Opus is a business advisory, restructuring, insolvency and exit management practice. The Partners are focused on commercially driven results and take a proactive approach towards tackling business challenges with an assurance of confidentiality. 44
Chartered One - Winter 2019 Advert - Opus 02-131119.indd 1
0151 705 9115 liverpool@opusllp.com www.opusllp.com twitter.com/opus_llp linkedin.com/company/opus-llp/
13/11/2019 11:23
LSCA Business
Information hubs from the ICAEW BREXIT–the latest resources and advice for ICAEW members and their clients. Business advice service (BAS) - Please do help us by promoting BAS to your contacts in business by explaining what the service is all about and pointing them to our new webpage. A further promotional push with LEPs, growth hubs, chambers and so on is in planning, and further press releases are also planned across the UK to raise awareness of this important service to local businesses. Latest ICAEW updates within the Coronavirus Hub - A reminder of the main Coronavirus Hub web link, including the Help for business section and a growing collection of sector-specific content relating to coronavirus. Just one of the recent areas of support is the Redundancy hub for employees and organisations.
Latest ICAEW updates within the COVID-19: global recovery Hub - Global recovery news and insights and accountancy's role in global recovery. Modern Slavery – would you know what to look for? https://www.icaew.com/technical/legal-and-regulatory/ modern-slavery ICAEW helplines and support - Details of which telephone helplines are available, and alternative live web chat facilities, can be found here. An advisor will be able to take your query and resolve it or connect you with the relevant teams. CABA courses - Learn how to support your physical and mental wellbeing and build your resilience in these challenging times. Upcoming live webinars, on-demand webinars and online courses enable you to achieve your goals, wherever you are in the world. ICAEW Communities – many of which are available at no cost to join As always, please do get in touch with me, if you have any questions or comments. Kind regards, Alex.
Alex Pilkington Regional Executive, Liverpool
T: +44 (0)192 559 4284 M: +44 (0)7876 035 943 E: Alex.Pilkington@icaew.com
ICAEW Jackson House, Meadowcroft Business Park, Pope Lane, Whitestake, Preston, PR2 2YB, United Kingdom icaew.com
www.charteredone.co.uk
ISSUE 31 Winter 2021
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LSCA Business
ICAEW know how
We published this in the last issue, and because it is such a wealth of information we shall be keeping this list of publications as a easy reference for you.
Technical Report PUBLICATIONS ISSUED DATE
TITLE
AREA
TYPE
13/01/21
Movement of goods - introduction to the UK-EU TCA
Tx F
Guide
14/01/21
Rules of Origin
Tx F
Online resource
20/01/21
The Modern Slavery Act 2015: An introduction for accountants
BL
Guide
20/01/21
The Modern Slavery Act : Section 54 transparency in supply chians statements
BL
Guide
21/01/21
Fraud and COVID-19 government support guide for auditors
AAF
Guide
21/01/21
The Modern Slavery Act: Actions for internal audit
BMF
Guide
21/01/21
How to spot victims of modern slavery
Multiple areas
HTML & PDF Guide
21/01/21
How to report modern slavery and human trafficking
BL
HTML & PDF Guide
22/01/21
Paying Dividends: The essentials
BL
Guide
25/01/21
AML: The Basics: Asset transfers
BL
Factsheet
29/01/21
Modern Slavery Statements; good and bad practice
Multiple areas
HTML & PDF Guide
31/01/21
LLP SORP 2020 annual review
FRF
Guide
05/02/21
UK endorsement of IFRS
FRF
Online resource
05/02/21
UK Endorsement Board
FRF
Online resource
08/02/21
Update to Brexit & Risk guide
AAF
Online resource
08/02/21
How to spot victims of modern slavery
BL
HTML & PDF Guide
09/02/21
Coronavirus: (Update) BBLS
CFF
Online resource
11/02/21
Contract modifications under IFRS 15 revenue from contracts with customers
FRF
Guide
22/02/21
Contract modifications under IFRS 9 Financial Instruments
FRF
Guide
25/02/21
AML: The Basics: Tax services
BL
Factsheet
26/02/21
2020 reporting year-ends: questions for the Board
BMF
Guide
28/02/21
Using open innovation
BMF
Guide
28/02/21
ESG in investment and transaction decisions
CFF
Guide
28/02/21
Red Flags : Signs of modern slavery
BL
HTML & PDF Guide
28/02/21
The Modern Slavery Act: section 54 transparency in supply chains statement checklist
BL
HTML & PDF Guide
28/02/21
Modern Slavery around the world
BL
HTML & PDF Guide
28/02/21
Modern Slavery Statements: Good and Bad Practice
BL
Guide
46
LSCA Business
EVENTS HELD DATE
TITLE
AREA
TYPE
11/01/21
Maintaining wellbeing during audit busy season
AAF
Webinar
13/01/21
MTD for corporation tax consultation
Tx F
Webinar
19/01/21
DAC6 affects SMEs too
Tx F
Webinar
21/01/21
What UK businesses and their boards need to know about the 6th carbon budget
Sus
Webinar
26/01/21
Bitesize Briefing: Amendments to UK GAAP for COVID-19-related rent concessions
FRF
On-Demand Recording
26/01/21
Review of UK Listings: Roundtable for Lord Hill with reporting accountants
CFF
Roundtable
27/01/21
Excel Tip of the Week Live - your questions answered (part 3)
TeF
Webinar
28/01/21
2020/21 Reporting: Going concern and impairment
FRF
Webinar
31/01/21
Modern Slavery - how to spot it
BL
Webinar
02/02/21
Hardman: Making tax digital - what does it mean for tax professionals
Tx F
Virtual event
02/02/21
Review of UK Listings: Roundtable for Lord Hill with lead advisers and principals
CFF
Roundtable
03/02/21
VAT reverse charge in the construction industry
TxFy
Webinar
04/02/21
Brexit and audit
AAF
Webinar
04/02/21
UK M&A in a Post-Covid World
CFF
Webinar
10/02/21
Interview techniques for the Zoom age
BMF
Webinar
11/02/21
MTD for income tax self-assessment
TxF
Webinar
11/02/21
COVID-19: A scientific perspective - looking to the future
FSF
Webinar
12/02/21
The Modern slavery Act 2015: An Introduction
BL
Webinar
12/02/21
The Modern Slavery Act: section 54 Transparency in Supply Chain Statements
BL
Webinar
15/02/21
IR35 and employment status
TxF
Webinar
22/02/21
Going concern and impairment - your questions answered (Bitesize briefing)
FRF
Webinar
23/02/21
Getting research & development claims right
TxF
Webinar
23/02/21
Getting more value from your procurement activities
BMF
Webinar
26/02/21
Improving use of charts in Excel
TeF
Webinar
26/02/21
Speech by Bank of England Deputy Governor Sir Dave Ramsden on bank resolution in conjunction with ICAEW
FSF
Webinar
www.charteredone.co.uk
ISSUE 31 Winter 2021
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Professional Services | Financial
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