+ VAT on private school fees
The new prime minister, Sir Keir Starmer is to proceed with Labour’s manifesto plans to levy VAT on fees for independent schools and reduce their current business rate exemptions.
The proposal to add VAT at the standard rate of 20% was initially scheduled to begin at the start of the academic year in September 2025. It has since been announced that the new scheme will run from the start of the term in January 2025.
The Institute for Fiscal Studies (IFS) has estimated that the scheme will raise around £1.6 billion a year in extra tax revenue. This will then be used to fund current gaps in state school education.
However, a likely consequence of the increased fees is more children moving away from the private sector into state education, raising further government costs. The IFS estimates this figure to be around 40,000 students.
The government has confirmed that there will be one exemption from the fees. Pupils who hold an EHCP which identifies educational, health and social needs will not have VAT added to their independent school fees.
Going forwards, schools will also be able to recover VAT on their own capital expenditure so the total increase in fees could be
reduced accordingly with some suggestions that it might be closer to 15%. It is also not yet defined whether school services such as welfare and transport might still be exempt from VAT.
Payment in advance
Many schools already have ‘fees in advance’ payment schemes and some had originally suggested that parents use this to circumvent the VAT addition. However, anti-forestalling provisions are to be introduced to stop this scenario – as they have when previous changes to VAT have occurred.
Funding
If you or your adult offspring have children in private schools, it is a good time to ensure that your cash flow planning is up-to-date, with the full facts of your current and predicted income and expenditure. As parents or grandparents, you might be looking at how best to fund the increased school fees as part of a wider financial plan and may be considering intergenerational wealth management to assist if possible. Please do speak with your adviser if this matter might impact you.
We expect further details and guidance on this topic in the next few months. There will also be more defined fiscal policy introduced by the new chancellor, Rachel Reeves, at her first budgetary announcement on 30 October 2024.
+ Comment: Paul Hart, director
Now we know the date of the new government’s first Budget, on 30 October, we can expect to see many forecasts about what may or may not be included in this fiscal statement. Much media speculation seems to focus on the likelihood of tax hikes in order to fund better public services.
The first suggestion is that the rate of capital gains tax (CGT) could be increased. Technically the CGT allowance has already been halved and then halved again over the last few years, from £12,300 to just £3,000. This move alone brought in an extra 570,000 CGT payers. The Office for Budget Responsibility (OBR) predicts that in 2024/25, CGT will raise £15.2 billion.
The pre-Election Labour manifesto did not clarify any CGT changes but it can be an easy target. Those with plans to dispose of an asset,
may wish to think about the best time for them to sell or gift it.
A further point of discussion is the ‘great wealth transfer’ – a term coined to describe the passing on of the ‘baby boomer’ generation’s wealth. Over the next 30 years, a transfer of around £5.5trillion is predicted to occur in the UK. This would be an obvious pot for a government to tap into if strapped for cash.
For the next year, the OBR estimates that IHT will raise £7.5 billion. The rate of IHT is normally 40 per cent on the value of an estate above the £325,000 threshold – a figure which has been frozen since 2009 and is set to remain until 2027/28 unless an intervention occurs. At the same time, house prices have risen by more than 70 per cent between 2009 and 2022.
While we do not have a crystal ball, we can ensure our own financial plans are in the best place to withstand whatever life, politics and economics, throw at it. Have you reviewed your own assets recently? Have you talked about intergenerational wealth plans with your family? Could you be doing more to be tax-efficient?
Being prepared normally gives peace of mind and allows you to ignore the next few months of media guesswork. Have a chat with your adviser if you would welcome some advice – you do not need to wait until your annual review if you have any concerns or questions.
+ Mortgage update: reduced central interest rate at long last
Beulah Antonin, Charterhouse Mortgages, writes: Those looking for a new mortgage were given some relief on 1 August when the Bank of England cut interest rates. The central bank’s Monetary Policy Committee voted to reduce bank rates by 0.25 percentage points to 5 per cent, the first time the rate has been cut since March 2020.
+ Thank you for recommending us
We are delighted to announce that the winner of our referral prize draw this quarter is Dr Shahid Khan. Shahid has won a Montblanc Meisterstück Classique pen.
We are always delighted to speak to your colleagues who may benefit from our specialist services and are grateful for the many
While many analysts are warning that the era of lower interest rates is over with higher rates now likely to be the norm, we have seen the first sub-4 per cent mortgages being released to borrowers in July.
If you have a current mortgage coming to an end, or need a new product deal, please review your options as soon as possible. Mortgage lenders are still allowing borrowers to secure rates up to four months in advance of their current deal ending.
We have entered a new chapter of politics and while we wait to find out the Chancellor Rachel Reeves’ financial objectives at her first Budget in October, it can pay to review your property loans before any major announcements. Please do not be tempted to ‘wait to see what happens’. You may find that you miss out on the best deal available to you while waiting for politicians to act. Please call us on 020 3838 1101 if we can help.
recommendations that help us to support more people. For every referral that contacts us, you will receive an entry into our quarterly prize draw which will take place in October. Please ask your contact to mention your name when they first enquire with us.
Many thanks for supporting our business.
+ Interview with Dr Malur Sudhanva
Dr Malur Sudhanva currently has three roles: Consultant Medical Virologist at the South London Specialist Virology Centre, King’s College Hospital, London; Strategic Clinical Lead for Virology, Synnovis; and Honorary Senior Clinical Advisor for Public Health and Clinical Oversight (PHCO) at the UK Health Security Agency.
From 2020 to 2022, he was the Lead Clinical Advisor for the laboratory team at the Lighthouse Laboratory Network overseeing the UK’s COVID-19 mass testing programme.
Why did you choose medicine?
Pursuing a career in medicine was largely serendipitous for me, shaped by the limited options available during my upbringing in India. In the 1980s, the prevalent choices were to become either an engineer or a doctor, with little to no career guidance highlighting alternative paths.
My decision to specialise in virology, however, came from a deeper interest. While completing my MD in microbiology at the prestigious institute JIPMER [Puducherry, India], I became captivated by the technological advancements in virology. This was a pivotal era for HIV diagnostics, which were revolutionising the identification of human pathogens. When I relocated to the UK in 1996, I seamlessly transitioned into the field of clinical virology, driven by my fascination and the technologies involved.
And you were working at the forefront of testing for COVID19?
Yes, this was a pivotal moment when the world truly recognised the value of clinical virologists. Our work encompasses many facets, with diagnostics being the most straightforward aspect and
my primary focus. During the early stages of COVID-19, my involvement extended beyond laboratory diagnostics to include infection control within the hospital, public health measures, vaccine advocacy, education for colleagues and the public, and influencing government policies.
Subsequently, I concentrated on national level laboratory diagnostics, working diligently behind the scenes. My efforts contributed to the government's implementation of policies and processes that were both clinically safe and relevant for the times. I now understand through others, that the diagnostic advancements I advocated for had a significant impact across the entire UK.
How did you cope with the pressure?
I would say there are three key ways to cope. Firstly, having a supportive family is crucial. My wife and son were very understanding of my long hours, my time away in Milton Keynes during lockdown, and my late nights. My son, who was doing his GCSEs at the time, and my wife, a breast surgeon, both understood and supported my demanding workload.
Secondly, the excellent people I worked with within the civil service, various consultancy agencies, Public Health England [now known as UK Health Security Agency] and NHS England were invaluable.
In many videoconferencing rooms, I often felt that I was not the smartest person there. This realisation indicated that I was collaborating with some of the brightest minds in the country. These high-quality individuals worked tirelessly behind the scenes, shaping my thoughts and contributing significantly to our efforts.
Unfortunately, their hard work often goes unrecognised in the media because they operate quietly, dedicating long hours, receiving late-night calls, and solving problems in remote expertise areas. There were pressures emanating from Cabinet Office, Parliamentary Questions, Freedom of Information queries and time-bound problem-solving; luckily I was part of a large team who pulled their weight, worked very hard and with unwavering dedication.
The third key to coping is to avoid detractors; both within the professional community and the media. At one point, there were many detractors who doubted the implementation of communitybased testing networks at large scale, bypassing the hospital-based limited testing.
The media were constantly scrutinising everything we said, so we tried to avoid the media as much as possible. I once participated in a live television appearance for an Indian channel, which was not a pleasant experience. After six hours of intense preparation, I had only 15 minutes on air. The host did not inform me that it was to be a two-member panel and wrongly directed questions to the
other person, questions to which I had prepared answers and had the right expertise. Further, there were attempts to sensationalise issues. This experience made me realise that media was not for me, and I did not want to jeopardise 20 years of professional work for fleeting media attention.
How easy was it to deal with many stakeholders and government organisations?
There were times when I had to make quick solo decisions, and other times when I had the support of fellow clinical advisers across the UK. Occasionally, I had to acknowledge when something was outside my area of expertise.
Over 20 years ago, I passed the FRCPath in virology examination, based on a rigorous virology curriculum conducted by the Royal College of Pathologists. This is one of the most challenging exams in the UK, and it assesses our ability to collaborate with various groups, including laboratory personnel, public health officials, finance teams, managers, and decision-makers. The exam emphasises evaluating business cases with a clinical perspective, weighing the pros and cons.
If you take that aspect of the virology curriculum, multiply the intensity by a dozen times, and compress the events into a few months, you get a sense of the pandemic's intensity in 2020, compounded by the immense responsibility, rapid decisionmaking, and relentless pressure.
Have you been able to look back and see what you have achieved?
As recently as last year, I was updating a set of PowerPoint slides based on our current knowledge base and was struck by how crude my slides were in March 2020. They became progressively more sophisticated with each passing month, reflecting the evolution of my understanding as the global knowledge base expanded. My ability to continuously sift through the rapidly expanding knowledge on COVID-19 and distil it into actionable and relevant advice for the UK was, I believe, my greatest achievement.
In early 2020, approximately 95% of our recommendations were implemented by the government and the testing team. Before the advent of the COVID-19 vaccine, testing was the primary tool for defining government policies on community interventions.
However, by 2022, only about 5% of our recommendations were actioned as the disease became milder worldwide and vaccine effectiveness increased. Once the virus established itself in the community as a milder disease, community testing became less relevant, though it remained important in hospital settings.
I recognise this progression and believe it reflects the correct and natural evolution of science and gives a balanced perspective of what I have achieved.
Being awarded an OBE for your work was an incredible achievement?
Receiving that OBE nomination letter from the Palace was a pleasant surprise. It was daunting to receive it and not be able to tell anyone. Being nominated for an OBE was an incredible honour and privilege, especially considering that when I arrived in London in 1996, all I had was a suitcase. In December 2021, I couldn’t contain my excitement and secretly told my relatives and gradually some close friends and of course, my mother. By the time the announcement came, I had told almost my entire circle of friends and family who had shaped me over decades. It was especially lovely to share the news with my old teachers, who are all retired. Fortunately, they all maintained the secret until the formal Palace announcement on December 31, 2021.
Attending the superbly organised investiture ceremony at Windsor Castle in December 2022 with my wife and son was a once-in-alifetime experience. I witnessed the well-rehearsed and smooth operation of the day's events. It was Prince William, Duke of Cambridge, who pinned the medal on me.
It was only when I saw the famous people around me at Windsor Castle receiving their respective honours that I truly grasped the magnitude of my achievement. At the same time, I felt a humbling realisation that I was indeed a small cog in the larger wheel of life.
I am very proud of that achievement and humbled by the recognition. My involvement in the national program began when I sent a protest letter to one of the NHS England chiefs in March 2020, offering our testing capabilities at King's College Hospital for our ward patients, ICU patients, staff, and neighbouring hospitals. The response indicated that we were outliers, as other hospitals lacked this testing capacity. Within days, I received a telephone call from Professor Dame Sue Hill, the chief scientific officer of NHS England, inviting me to Milton Keynes to provide clinical virology advice. This moment set everything else in motion for me, leading to the OBE.
Have you been involved in the COVID inquiry this year?
We are currently providing written evidence. While I don't know if I'll be called to testify in person, they are delving into the technical aspects with the civil service and experts like me.
It is crucial for the nation to examine all aspects of the pandemic response, both successes and failures, and document them. Testing was one of the things we did exceptionally well.
We have published numerous papers on testing to guide the next generation in managing future pandemics and avoiding similar mistakes. Every time I travel outside the UK and discuss our COVID testing efforts, people are amazed by what we achieved. In Milton Keynes, at one point, we were testing 5,000 samples an hour, an unprecedented feat in the UK. One can imagine the level of infrastructure, automation, and troubleshooting skills required
to handle that volume of samples.
Other nations envy our accomplishments in testing, and we need to remember and learn from this success and failures. The COVID inquiry is one aspect of this learning.
What is the next project?
My current goal is to focus on the local South East London region. I have recently been appointed as the Strategic Clinical Lead in
+ Your digital media legacy
An unexpected part of dealing with bereavements is navigating the digital world of a loved one. Using the internet, social media or apps on devices, means we now need to think about ‘digital estates’ should family members pass away.
Videos uploaded to sites such as Facebook, music purchased on Spotify, Bitcoin held in a Cryptocurrency wallet, can all be withheld by the online service provider without clear plans of transfer in place. Technology is fast becoming an important part of estate planning.
Many sites now use biometric data to login such as fingerprint and face recognition which makes gaining access to someone else’s online possessions ever more challenging. Plus, even if you know the person’s password, you could be breaching regulations by accessing their accounts after they have died.
The Digital Legacy Association offers some free advice and tutorials to help with this new and tricky area. They also explain why it is important to create a ‘Social Media Will’ that details the sites and apps people use and what they would like to happen to them in the future. They offer a free template to help build this document.
As is often the case, technology has moved on much more quickly than the law so establishing where you stand legally can be difficult. You may also want to think about closing accounts securely to protect your loved one’s details being used for criminal activity.
The Bereavement Advice Centre offers some practical tips on how to manage digital legacies after death and contacting social media and email accounts.
We believe considering the practical side of estate planning is one of the kindest things you can do for your family. At MFF, we are now offering a lasting power of attorney (LPA) service to help
Virology at Synnovis, a pathology service provider for King’s College Hospital, Guy’s and St Thomas’s Hospital, and all the GPs in the region. This laboratory was recently hit by a well-publicised cyberattack in June, causing considerable delays in transforming services.
We have a massive state-of-the-art facility in Blackfriars, and my immediate goal for the next three years is to help run this facility and stabilise virology services across South East London.
protect your interests and to ease the burden on your loved ones.
A lasting power of attorney is a legal document that appoints someone to manage your affairs in the event you are no longer able to do so. This might be the case, for example, if you are impacted by a health condition which affects your mental capacity.
The lasting power of attorney means a trusted representative can make decisions affecting your care and your finances on your behalf. Without a lasting power of attorney in place, your loved ones will have to apply to the courts to have someone appointed to manage your affairs and in our experience, this can be a very lengthy and costly exercise for your family which could last many months.
There are two types of lasting power of attorney, health and welfare, and property and finance. You can take out one type or both, to ensure your total personal affairs are covered.
We can help you to complete your LPA applications. We will send you the relevant form to complete online, check the details are correct and finalise the form before asking you to sign it.
We will then submit the lasting power of attorney to the Office of the Public Guardian (OPG) for registration.
Please speak with your adviser if you require any further information on our new LPA service. The cost to register for each type of lasting power of attorney is £250 plus VAT (plus the £82 set fee the OPG charges).
www.digitallegacyassociation.org www.bereavementadvice.org/topics/registering-a-deathand-informing-others/how-to-contact-different-servicesdigital-legacy/