Disguised Remuneration Rules

The HMRC released a new policy over disguised remuneration effective 6 April 2011. This covers new anti avoidance rules over employment income paid through third parties. Individuals receiving income from overseas companies will be affected by the new policy and will need to consider whether the income falls within the HMRC definition of disguised remuneration. If so, the individuals will need to declare the income on their future tax returns.

Retailers braced for another poor Christmas

UK Retailers are braced for another poor Christmas this year due to heavy price discounting. Sales in December are likely to exceed last year which was disrupted by recession and heavy snow in the build up to Christmas. However, 2011 is set to be another poor year due to heavy discounting taking place before Christmas Eve as retailers could not risk waiting till Boxing Day to announce their sales.

The growth in customers purchasing their Christmas presents online is also likely to impact the retailers although they can take some respite from the fact that some online companies, including Amazon, failed to deliver their goods before Christmas. The tip is to order your goods online and not leave things to the last minute.

EU Transaction Tax

On 28 September the European Commission published a proposal for the introduction of a Financial Transaction Tax. France and Germany, the biggest members of the EU have endorsed the plan whilst the United Kingdom is strongly opposed to the tax as this will have a disproportionate impact on the country with the largest financial services center in Europe. 

It is proposed that a 0.1% tax will be imposed by EU member states on bonds, shares and other derivative transactions. Under current levels, the scheme will raise €57 billion in tax in a bid to combat the Euro crisis and restore the coffers of the ECB which have been depleted following the bailing out the failing EU member states. 

The proposal will require unanimous support from all EC member states before it can be implemented. Whether the transaction tax will receive the required support remains to be seen. Clearly a financial transactions tax will have a negative impact on the UK economy and hence it is strongly opposed in this country. However, any move to introduce the transaction tax will have interesting consequences for both traders and the banks as it could impair their ability to manipulate the stock markets through the use of sophisticated computer programmes. This could have a positive effect for small independent traders if it serves to filter out the inefficient big players in the market. Angela Merkel has already attempted to outlaw speculative short selling of the Euro and is clearly concerned about manipulation in the market.