Business news 19 December 2024
Inflation hits eight-month high. Interest rates, tax, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
UPDATE: Breaking – BOE leaves rates at 4.75 after a 6-3 vote – more tomorrow
Inflation hits eight-month high
UK inflation has surged to its highest level in eight months, reaching 2.6% in November, up from 2.3% in October. This increase, driven by higher petrol and grocery prices, adds pressure on the Bank of England to maintain interest rates at 4.75%. Sanjay Raja at Deutsche Bank said: “Price pressures are resurfacing again – with employers likely to start ramping up prices at the start of the year to account for the employer NICs increase. Put bluntly, the Monetary Policy Committee is some way away from declaring victory on inflation.”
Markets
This morning on currencies, the pound is currently worth $1.265 and €1.216. On Commodities, Oil (Brent) is at $73.4 & Gold is at $2618.
On the stock markets, overnight in the US the S&P 500 fell 2.95% to 5872.16 and the NASDAQ fell 3.56% to 19392.70 after the Fed reduced rates by 0.25% (to 4.25-4.5%) but said it’s concerned about persistent inflation and is likely to cut interest rates less than previously anticipated in 2025. US stocks however look set to bounce a bit on the view that the selloff was overdone. Meanwhile Trump is opposing a bipartisan funding bill and threatening to oust Republicans who accept legislation that doesn’t include his demands, increasing the likelihood of a government shutdown this week.
However, globally stocks have followed the US stocks down. The FTSE 100 is currently down 1.41% at 8083 and the Eurostoxx 50 is down 1.66% at 4874.92.
UK markets are also lower and bond yields are rising with the Bank of England set to announce it’s policy decision today. Traders have rapidly unwound bets on further easing from the BOE in the hours before the announcement.
House Prices
UK House Prices increased by 3.4% in the 12 months to October, ticking upwards from 2.8% in September, according to Office for National Statistics data. The average house price in October was £292,000. Annual growth in private rental prices accelerated to 9.1% in November, from 8.7% in the 12 months to October. This was just below a record rise of 9.2%, recorded in March 2024.
Defence Spending
Prime Minister Keir Starmer restated his pledge to increase defence spending to 2.5% of gross domestic product. In an interview with LBC radio, Starmer was asked if Britain would consider increasing defence spending to 3% of GDP. “The commitment we’ve made is to set out a path to 2.5%,” he replied.
Stamp duty remains a barrier to investing
The Financial Conduct Authority (FCA) has proposed a new private stock market system, PISCES, aimed at encouraging businesses to list in the UK and reversing a £100bn exodus from the London Stock Exchange. Richard Wilson, chief executive of interactive investor, welcomed the move but said the Government’s tax policies, particularly the 0.5% stamp duty reserve tax, make the London market “untradable,” pushing growth businesses to list elsewhere. Wilson stressed the need for the Government to act decisively to support financial markets, stating: “If the market dies, then growth and with it ultimately our standard of living are sacrificed.”
Tractor tax will hit more farms than thought
The impact of Labour’s “tractor tax” on farmers has been significantly underestimated, according to Jeremy Moody, secretary and adviser to the Central Association of Agricultural Valuers. He warns that the number of farmers affected by the inheritance tax (IHT) could be five times higher than the Treasury’s estimates due to historical undervaluation of farm assets. Moody explained that farmers have relied on cost-based valuations for their assets, which do not reflect the “market value” required by IHT laws. With Labour’s cuts to tax breaks for assets over £1m, many farmers will now face increased tax liabilities. Moody predicts that around 75,000 farmers will be impacted by these changes, contrasting sharply with the Government’s claim that fewer than 500 estates will be affected annually.
Police seize £2m from Tate brothers
Police have been granted permission to seize over £2m from influencers Andrew and Tristan Tate after they failed to pay tax on £21m of revenue from their online ventures. Chief magistrate Paul Goldspring described the situation as a “straightforward cheat of the revenue,” despite the brothers presenting it as a “complex financial matrix.” The court revealed that the Tates had funnelled nearly $12m (£9m) into an account under a woman identified only as J, who had no involvement in their businesses. The seizure includes cryptocurrency held in J’s name, with one payment to her Revolut account amounting to £805,000.
WealthTek partner charged with fraud
The Financial Conduct Authority (FCA) has charged John Dance, a former principal partner at WealthTek, with fraud and laundering over £64m from client accounts. Allegations state that between 2014 and 2023, Dance exploited his position to fund a lavish lifestyle, including horse-racing and a nightclub. The FCA has been investigating WealthTek and Dance since 2023 for potential breaches affecting client money. The firm was placed under special administration in April 2023, with plans to return assets to affected clients. The FCA remarked: “This is one of the most serious and largest frauds we have ever investigated.” Dance faces nine criminal offences related to fraud and laundering, alongside three additional offences for false representations regarding WealthTek’s regulatory permissions.
Shoe Zone to close unviable stores
Shoe Zone has announced plans to close several stores due to rising costs from recent budget measures, which have rendered some locations “unviable.” The company cited increased employers’ national insurance contributions and minimum wage as key factors affecting profitability. Shoe Zone expects adjusted pretax profits for the year ending September 27, 2025, to be “not less than £5m,” a significant drop from previous estimates of £10m. The retailer’s shares have fallen by 38.5% to 85p, reflecting a broader decline of two-thirds over the past year. Despite some analysts questioning the decision to blame the budget for store closures, Zeus Capital noted that Shoe Zone operates in a defensive subsector of the consumer market.
Reeves ignores questions over her ‘edited’ CV
The Chancellor has failed to respond to allegations that she edited her online CV following reports she lied about her job prior to becoming an MP. Former Conservative chairman Richard Holden last month asked Rachel Reeves to answer a series of questions, but she has apparently ignored the letter, breaching government guidance. Mr Holden said: “This country deserves to know if one of its most senior politicians has deceived them. I will continue to push for the answers that are so sorely needed.”
Trump’s tax plan for expats moves forward
Illinois Republican Rep. Darin LaHood has introduced a bill to eliminate income tax for Americans living abroad, aligning with Donald Trump’s campaign promise. The proposed legislation would allow Americans to pay taxes in their country of residence without filing US tax returns, although they would still owe taxes on US-sourced income.
Latest Insolvencies
Petitions to wind up (Companies) – MANOR PLACE HOTEL LTD
Petitions to wind up (Companies) – DREAMLAND BEDS B’HAM LIMITED
Petitions to wind up (Companies) – ZANGA ZANGA LIMITED
Appointment of Liquidators – SIMPLE CONSTRUCTION SOFTWARE LTD
Petitions to wind up (Companies) – OPAQUE TRADING LIMITED
Winding up Order (Companies) – JAYLYN LTD
Petitions to wind up (Companies) – RC LIFESTYLE SERVICES LTD
Appointment of Liquidators – K M TRAINING LIMITED
Petitions to wind up (Companies) – POPE & CO DW LIMITED
Petitions to wind up (Companies) – BRAYBROOKE ROAD DESBOROUGH LTD
Petitions to wind up (Companies) – JPH UTILITIES LTD
Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.