A License To Print Money In The UK?
Posted: 29/07/2010 Filed under: Small Business, UK Investment, UK Taxation | Tags: business, business concerns, corporate tax, corporation tax, economy Leave a comment »In recent news it was revealed that economist believe the Bank of England could restart quantative easing in the near future. What does this mean in real terms, well, basically the government is considering printing more money. Whether this is a good or a bad thing, just like with VAT rises, depends on who you talk to.
Minutes have been released from this month’s BoE rate-settings meeting and showed that the topic of “money printing” had been discussed for the first time since February.
The discussion was prompted by fears over the economic recovery.
“In the light of the news over the month, it seemed likely that growth would be weaker than previously expected,” the minutes said.
In a broad debate about policy actions in the event of an unexpected weakening or strengthening of the economy, the minutes suggested: “A further modest monetary stimulus would act to offset the softening in demand prospects and make it more likely that the inflation target would be met in the medium term.”
Vicky Redwood of Capital Economics noted that the discussion was “perhaps the clearest steer so far that more QE could yet be on the agenda”, and added: “July’s minutes suggest that a near-term interest rate hike still looks unlikely. What’s more, there were some dovish comments from other members, who noted that the prospects for GDP had deteriorated a little.”
Philip Shaw at Investec agreed, saying: “The key change was that members recognised that the outlook for activity had weakened since June’s meeting, and as a result, actively discussed the option of easing policy again… We cannot rule out a further round of QE… The outlook for interest rates is shrouded in uncertainty.”
Uncertainty indeed, with the government saying one thing and the Bank of England saying another, how are the British public supposed to know where they stand? I think they need to converse with each other in order to give us an honest answer.
2010 remains a consistent year for small business in the UK.
Posted: 15/07/2010 Filed under: Investment, Moving to London, UK Investment | Tags: business concerns, Small Business, uk investments Leave a comment »Data has been released from the British Banking Association that the total value for around 10,000 new term loans to small businesses in the May was £523 million. This, apparently, is a drop from May 2009 where this figure was around £600 million.
Banks who have been releasing loans in accordance with BBA’s statistics are The Co-operative Bank, Santander UK (including Alliance & Leicester), Barclays, Clydesdale (including Yorkshire Bank), HSBC, Lloyds Banking Group (including HBOS) and Royal Bank of Scotland (including NatWest).
On average, the new loan is approximately £50,000 and usually more than ten years duration, with varied interest rates.
Small business loans hold a large chunk of the banking industry, with total term lending standing at £46 billion and this is supplemented by over £8 billion of over draft borrowing.
All of these facts and figures may show a small loss in the small business economy but as the British Banking Director Dooks said “New term lending to small businesses is stable and continuing at more than £500m a month.”
Dooks also went on to say “Higher repayments from businesses looking to contain their operating costs are countering new lending, so negative net changes in the banks’ lending portfolio are a consequence. Until an improvement in economic trading conditions looks more certain, small businesses’ borrowing will remain subdued.”
I believe the Director has a valid point, there is an encouraging stability in the British small business market; the figures speak for themselves.
ICT Immigration To Add to UK Prosperity
Posted: 14/07/2010 Filed under: UK Immigration, UK Investment | Tags: corporate tax, corporation tax, Immigration Leave a comment »I have recently read that new figures have been released relativing to the large scale of immigrant workers coming into Britain via the ICT system.
The ‘intra-company transfers’ that are being referred to as a ‘loop hole’, is what companies are using to get around the recently announced Conservative manifesto pledge.
The pledge, put in place by the Home Secretary, Theresa May, several weeks back, states that there shall be a limited number of migrant workers allowed into Britain from outside the EU, no more than 24,400 shall be granted access.
There are worries over the exploitation of the ICT system, as they believe it threatens the Governments plan to scale back migration levels in order to reflect the numbers in Britain from the 1990′s.
The Home Office has released a list of over 20,000 employers who have signed up to the programme to bring skilled migrant workers to the UK. The list was published on the UK Border Agency website weeks back, names range from Chelsea Football Club to hundreds of restaurants and takeaways.
From where I stand this is not a problem, I agree with Damien Green, the Immigration Minister “It is important that we attract the brightest and the best people who can make a real difference to our economic growth”.
The ICT system is a wonderful way for Britain to become one of the most diverse countries in the world, with the most skilled workers doing their best for the UK’s economy.
Are We Our Own Worst Enemy? VAT Rises.
Posted: 12/07/2010 Filed under: UK Investment, UK Taxation, VAT, VAT Registration | Tags: business concerns, corporation tax, Tax, UK tax, VAT Leave a comment »It looks as though us Britons are tightening our purse strings again, as we fear another recession backlash. It is said we fear a ‘double dip’ in the economic climate after the recent VAT increase to 20pc.
Being more careful about what we purchase, four in ten have said they wardrobe raided in order to recycle their old garments as opposed to buying new, up to date fashion.
According to the survey conducted by GfK NOP, a third of consumers claimed they had stopped dining out in order to save the pennies and credit cards are being used less for those luxury items we indulge upon.
It isn’t just the consumer-facing companies that seem to be threatened either, people are now changing their lifestyle choices, 6pc surveyed are postponing getting married and an equal amount are putting off having children until the threat has passed.
Ironically, the fear that has been created surrounded the second recession is, in fact, what just may cause the ‘double dip’. Our inclination as a nation to save during these times of ‘economic uncertainy’ could have a devastating effect in the long run.
It is my opinion that consumers should not be so over-cautious when considering the coming of the second recession.
If you are worried about the double dip (AGAIN) and want to discuss any aspect of your business, Please contact us here at St Matthew’s eAccounting. We know business in the uK
Saving Rates To Match Rate Of Inflation
Posted: 20/05/2010 Filed under: Investment, Moving to London, UK Investment, Uncategorized | Tags: business, business concerns, economy, Moving to London, moving to the UK, moving to UK Leave a comment »Further to yesterday’s blog I noticed an article in The Guardian that had some good news regarding inflation. A few banks are apparently pledged to keep some saving accounts at a higher rate of interest than inflation. The reason I highlight this is that many of my clients have a vested interest in the UK economy and many of them are doing well enough to consider the implications of inflation for their savings.
It seems that Northern Rock and Nottingham building society are making sure saving rates are higher than those of inflation. This is great news for savers and I believe a clever move on the bank’s part. People who move their savings to the banks with a great interest rate to beat inflation now will probably stick around.
Anyway my main purpose for mentioning this is the fact that I am determined to add a bit of positive to the coverage of the economic situation. I am reminded at the moment of all the dire predictions for the recession that have not even come close to coming true. I genuinely remember listening to some guy on radio four confidently predicting that this recession was going to be so bad that life as we know it would be over.
Mmm maybe not.
In the meantime if you are looking to move to London or start a company here then we can help you to do so. Here at St Matthew’s Accounting we have been helping people to settle in England and build successful companies for years. We know what we are doing.
Inflation On the Rise
Posted: 20/05/2010 Filed under: Small Business, UK election, UK Investment, Uncategorized Leave a comment »As we all hold our breath, the new government is struggling to establish itself and put together a comprehensive plan to run the country. I think it is inevitable that the stories the press choose to run with are at the more miserable end of the spectrum. The simple fact is doom and gloom sells more papers than good news.
So the main story the business sector of the nationals is focusing on at the moment is the rise of inflation. We have hit a high in inflation, the highest inflation rate in 17 years and this is making everyone twitchy. No economy likes high inflation; it always brings forward mention of the disastrous Weimar republic period in Germany where people were bring barrows of cash to do their shopping.
I don’t think things are that dire here yet and it is fairly safe to say that there are no indications they will be. In fact people have been using the Weimar republic as a salutary story for nearly a hundred years for a reason, the scale of that inflationary disaster has not been repeated in nearly a century.
I will, like every business person, be keeping my eye on how things progress with the issue but I must admit, so far I am willing to give the new government time to settle in before I start pushing any panic buttons.
How Will New Government Affect Property Investors
Posted: 14/05/2010 Filed under: Investment, UK Company Set Up, UK election, UK Investment, Uncategorized | Tags: investments, recovery, Small Business Leave a comment »The rumour is so strong that George Osborne is going to hike up capital gains tax in his emergency budget that i am not even sure it qualifies as a rumour. It is fairly certain that the property sector in the UK is going to rasie CGT from 18% to a whopping 40% or maybe even 50%. That is going to have huge ramifications for small business men who earn their living in property. But contrary to what you may think it is not all bad news for property investors.
Granted this is news that will have some property investors gasping for air. So much so that it may well lead to a lot of people getting rid of their properties. This is likely to send prices plummeting. But here is, no cloud without a silver lining. Those people who make their living through renting property and are lucky enough to be able to finance it will be very excited by this news. They will be able to snap up property at a very low price and then rent it and sit back and wait to see what happens. With most landlords keeping their properties for an average of 12 years, todays policies on CGT are of little consequence.
It may be a very a good time to be a property investor in the UK.
VAT is The Gorilla in the Room in Election
Posted: 04/05/2010 Filed under: UK election, UK Investment, UK Taxation, Uncategorized, VAT, VAT Registration | Tags: business concerns, corporate tax, Taxation, uk companies, UK tax, VAT Leave a comment »Sorry to be like everybody else and keep banging on about the election but if you are interested in the financial structure of the UK it is pretty hard to ignore at the moment. On the bright side it is nearly over and we can start talking about something else very shortly, but for now… There was an interesting article in the guardian this week regarding VAT and its place in the election.
The article was quoting the holy grail of think tanks the Institute for Fiscal Studies. In very diplomatic and polite terms the IFS made a statement this week that basically said that the parties were telling us fibs or at the very least putting a gloss on the truth. According to them we are facing four years of austerity and tax cuts under either party. Each will raise taxes and make cuts to pull Britain out of the deficit mire just the ration will change.
The Tories will have a ratio of 4 to in favour of cuts over taxes, Labour will do it at a ratio of 2 to 1 and the Lib Dems will fall somewhere in between. And no matter which party you elect Vat will rise.
Personally, and it may sound odd, I am not terribly concerned about any of this. Let’s do what is necessary to get our economy back on track.
Hung Parliament Will Bring Out the Gamblers
Posted: 02/05/2010 Filed under: Small Business, UK election, UK Investment, Uncategorized | Tags: business, business concerns, gambling, Small Business, Taxation Leave a comment »There is much speculation about the effects on the UK economy and UK business that a hung parliament would bring. In many ways a hung parliament can be seen to be a good thing. It is possible that the Lib Dems looking over the shoulder of one of the major parties would give us an experienced government with a conscience. But in terms of UK business it is possible that the way it is viewed internationally would result in it being a negative.
Many are predicting a plummet in the pound sterling if the day after election day sees us with a hung parliament. This is a possible real problem for the economy but even where there is bad news there are speculators and gamblers waiting to make a buck. Many millions of pounds could be won or lost on Friday morning as the markets open early for the first time and traders start gambling on the possibility of the plummeting pound.
I wonder if the big bookies such as Ladbrokes will be allowing the average punter to speculate on the chances of a falling pound. Given what we know about bookies and the English fondness for a good gamble it seems highly probable.
I have been harbouring a quiet fondness for the idea of a hung parliament but it seems that in terms of UK finances it may be a situation best avoided.
Worldwide Tax To Hit Britain The Hardest
Posted: 27/04/2010 Filed under: Moving to London, Small Business, UK Investment, UK Taxation, Uncategorized | Tags: business, business concerns, corporate tax, corporation tax, moving to the UK, Non Dom, Taxation Leave a comment »There is growing momentum in the world financial sector for the beginning of a worldwide banking tax. I feel this really does make sense in terms of the big picture. The days of each country being a largely separate economy are long gone as is evidenced by the global crisis we have all just been through. We are now all inextricably linked.
Having said that each country will, of course, look at the proposal of a worldwide banking tax largely from their own point of view. For Britain experts estimate that it will cost around the 5 billion mark, is this likely to hit London far harder than it does other countries? Some experts are worried that is the case. As a result the UK is currently leading th drum banging against this kind of tax.
London has been one of the most competitive financial markets in the world for quite some time now and this is largely down to the flexibility provided by the large amount of self regulation the banks enjoy. There is no doubt that in the short to mid term this needs to be tightened up but how much and do we risk strangling the competitive edge from the UK banks?
If you are worried about taxation on a much smaller scale, the taxation of your business then you can feel free to call in the experts here at St Matthew’s eAccounting. We may not be able to solve the world taxation problems but we are experts at solving those of the average UK business.
