28thMar
News article

AI could replace up to 8 million UK jobs, warns report

Up to eight million UK jobs are at risk from the rise of artificial intelligence (AI), according to a report by the Institute for Public Policy Research (IPPR).

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Up to eight million UK jobs are at risk from the rise of artificial intelligence (AI), according to a report by the Institute for Public Policy Research (IPPR).

The effects of generative AI are already being widely felt as 11% of tasks done by workers are currently exposed, said.

It said that back office, entry level and part-time jobs were at the highest risk of being disrupted during the so-called first wave, with women and young people the most likely to be affected as a result.

Carsten Jung, Senior Economist at the IPPR, said: 'Already existing generative AI could lead to big labour market disruption or it could hugely boost economic growth, either way it is set to be a game changer for millions of us.

'The question now is less whether AI can be useful, but rather how fast and in what manner employers will use it. History show that technological transition can be a boon if well managed or can end in disruption if left to unfold without controls. Indeed, some occupations could be hard hit by generative AI, starting with back-office jobs.

'But technology isn't destiny and a jobs apocalypse is not inevitable – government, employers and unions have the opportunity to make crucial design decisions now that ensure we manage this new technology well. If they don't act soon, it may be too late.'

27thMar
News article

NMW is the 'single most successful economic policy in a generation', says think tank

The introduction of the UK's National Minimum Wage (NMW) in 1999 is the single most successful economic policy in a generation, according to the Resolution Foundation.

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The introduction of the UK's National Minimum Wage (NMW) in 1999 is the single most successful economic policy in a generation, according to the Resolution Foundation.

The NMW has increased the pay of the UK's lowest paid workers by £6,000 a year compared to their earnings simply rising in line with typical wages, says a report from the thinktank.

The report notes that the policy was introduced 25 years ago against a backdrop of rising pay inequality.

Between 1980 and 1998, hourly pay growth in the UK was twice as fast for the highest earners as it was for the lowest earners.

But since 1999 – when the NMW was brought in – this trend has reversed, and hourly pay inequality has fallen with pay growth for the lowest earners five times that seen by the highest earners.

Nye Cominetti, Principal Economist at the Resolution Foundation, said: 'The policy was introduced in the face of fierce opposition, but now experiences strong cross-party support. With its current remit ending this year, now is the time to discuss the future of the minimum wage and low pay more widely ahead of the election.

'Politicians should reflect on why the minimum wage has been so successful – such as the combination of long-term political direction and independent, expert-led oversight – and whether this approach could be broadened to tackle some of the UK's other low pay challenges.'

 

26thMar
News article

HMRC's services having a negative impact on SME productivity

The productivity and efficiency of SMEs is suffering as a result of poor HMRC services, according to members of the Association of Chartered Certified Accountants (ACCA).

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The productivity and efficiency of SMEs is suffering as a result of poor HMRC services, according to members of the Association of Chartered Certified Accountants (ACCA).

In a survey of ACCA members, 66% said that poor HMRC services were having a negative impact on their clients, with small businesses 'bearing the brunt' of this issue.

This is a 14% increase in negative sentiment from the previous ACCA survey in October 2023, demonstrating that SMEs are 'reaching breaking point with the service'. 

Glenn Collins, Head of Strategic and Technical Engagement, ACCA UK, said: 'Our members have repeatedly raised that dealing with HMRC is the number one issue they face in their daily work.

'Repeatedly we hear from our members of delays around basic requests such as VAT registration numbers, and a severe lack of skilled staff to handle more complex enquiries. This most recent survey reiterates our previous feedback to the Chancellor and HMRC and shows that in the space of six months service levels have declined even more.

'ACCA will continue to call for the Chancellor to properly fund HMRC, raise the levels of service standards, and to lean on accredited finance professionals wherever possible to ensure accuracy across the board.'

25thMar
News article

Small businesses still hampered by late payments, warns FSB

Small UK firms are still being hampered by late payments, warns the Federation of Small Businesses (FSB).

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Small UK firms are still being hampered by late payments, warns the Federation of Small Businesses (FSB).

The business group found that the proportion of small firms whose late payments worsened in the final quarter of 2023 rose from over one in four to over a third.

The FSB said that small businesses have 'dampened' growth expectations for 2024.

It also found that the percentage of firms seeking to increase their capital investment stayed flat between the third quarter of 2023 and the fourth quarter.

Martin McTague, National Chair of the FSB, said: 'Late payment is a scourge, and one that shouldn't exist – there's no excuse, with modern business banking methods, for large companies to hold onto money due to small suppliers.

'Overdue invoices cause uncountable amounts of stress and harm to small business owners, leading to sleepless nights and lost productivity. Large companies should make their payment performance a board-level issue, and include it in annual reports, to improve accountability and transparency.

'Small firms contain the dynamism and the ambition to grow that will get the economy up and running, if they are given the right conditions to flourish, invest, and make their mark.'

22ndMar
News article

Interest rate decision prolongs uncertainty for firms, warns BCC

The Bank of England's decision to hold interest rates at 5.25% prolongs the period of uncertainty for firms, warns the British Chambers of Commerce (BCC).

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The Bank of England's decision to hold interest rates at 5.25% prolongs the period of uncertainty for firms, warns the British Chambers of Commerce (BCC).

The Bank's Monetary Policy Committee (MPC) voted by eight to one to hold the base rate at 5.25%, the fifth month in a row that it has stayed at that level.

The Bank said that the recent falls in the rate of inflation were 'encouraging' but that it needs to be certain that inflation will fall to its 2% target and stay there before making cuts to rates.

David Bharier, Head of Research at the BCC, said the decision to hold rates was widely expected.

He added: 'However, it prolongs the period of uncertainty for firms grappling with high borrowing costs.

'While [the] inflation data showed a further easing, most small businesses know that the economy remains fragile. The interest rate is itself a driver of inflation, as housing, rental, and borrowing costs continue to rise.

'Our most recent forecast expects some cuts to the base rate going forward, potentially falling to 4.5% by the end of the year. But in the meantime, businesses need reassurance from policymakers that there is a clear plan to drive much needed economic growth.'

21stMar
News article

HMRC halts helpline closures

HMRC has halted its plans to restrict taxpayer helplines and direct people to online services instead.

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HMRC has halted its plans to restrict taxpayer helplines and direct people to online services instead.

The tax authority had announced that it was closing its self assessment helpline for six months every year. It was also restricting the opening times of its VAT helpline and the usage of its PAYE helpline.

HMRC says it is halting these plans 'in response to the feedback while it engages with its stakeholders about how to ensure all taxpayers' needs'.

HMRC Chief Executive Jim Harra said: 'Making best use of online services allows HMRC to help more taxpayers and get the most out of every pound of taxpayers' money by boosting productivity.

'Our helpline and webchat advisers will always be there for those taxpayers who need support because they are vulnerable, digitally excluded or have complex affairs.

'However, the pace of this change needs to match the public appetite for managing their tax affairs online.

'We've listened to the feedback and we're halting the helpline changes as we recognise more needs to be done to ensure all taxpayers' needs are met, whilst also encouraging them to transition to online services.'

20thMar
News article

HMRC closes self assessment helpline for six months a year

HMRC will close its self assessment helpline for six months every year and urge taxpayers to use its online services instead.

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HMRC will close its self assessment helpline for six months every year and urge taxpayers to use its online services instead.

The tax authority is also making changes to its VAT and PAYE helplines. It says the changes follow a successful trial and are now being rolled out permanently.

The self assessment helpline will now be closed from April to September every year, during these months taxpayers will be directed to online services. The self assessment helpline will open between October and March to deal with priority queries.

The VAT helpline will be open for five days every month ahead of the deadline for filing VAT returns. Outside of these days, taxpayers will be directed to use HMRC's online services.

In addition, the PAYE helpline will no longer take calls from customers relating to refunds.

Angela MacDonald, HMRC's Second Permanent Secretary and Deputy Chief Executive, said: 'Online services have transformed our lives and often provide a better service for managing tax – they're quicker, easier and always available.

'Changing our services to encourage customers to self-serve online wherever possible will allow our helpline advisers to focus support where it is most needed - helping those with complex tax queries and those who are vulnerable and need extra support.

'We must maximise every pound of taxpayers' money. Embracing online self-service allows us to help more customers and improve our customer service levels without spending additional public money.'

19thMar
News article

Number of company insolvencies rises by 17%

Data published by the Insolvency Service has revealed that the number of company insolvencies in England and Wales rose by 17% in February 2024 when compared to the same month last year.

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Data published by the Insolvency Service has revealed that the number of company insolvencies in England and Wales rose by 17% in February 2024 when compared to the same month last year.

The number of registered company insolvencies was 2,102 in February, the data showed, compared to 1,801 in February 2023. According to the Insolvency Service, the latest figure is higher than levels seen whilst government Covid-19 business support measures were in place.

The data revealed that the insolvencies consisted of 217 compulsory liquidations, 1,707 creditors' voluntary liquidations, 166 administrations and 12 company voluntary arrangements.

In regard to individual insolvencies, 10,136 were recorded in February 2024, which was 23% higher than in the same month the previous year. The individual insolvencies consisted of 709 bankruptcies, 3,007 debt relief orders (DROs) and 6,420 individual voluntary arrangements (IVAs). 

18thMar
News article

New HMRC R&D tax relief guidance 'could be clearer', says ICAEW

The Institute of Chartered Accountants in England and Wales (ICAEW) has stated that new guidance from HMRC on research and development (R&D) tax relief guidance 'could be clearer'.

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The Institute of Chartered Accountants in England and Wales (ICAEW) has stated that new guidance from HMRC on research and development (R&D) tax relief guidance 'could be clearer'.

HMRC's draft guidance covers the restriction applying for contractor payments and payments for externally provided workers (EPWs) where the R&D activity takes place overseas; and the new rules for contracted-out R&D.

The ICAEW's Tax Faculty believes that additional clarity would be 'helpful' on a few of the new points.

It also said that the guidance 'does not fully address the implications of an arrangement between the customer and the contractor that is governed by multiple contracts'. The Institute has called for the guidance to explain how to determine if the contractor took R&D into consideration at the time of the contract when multiple contract dates exist.

The ICAEW also called for clarity on the requirement that the carrying-on of R&D needs to be the primary objective of the customer in engaging the contractor if the customer is to claim the associated R&D tax relief. 

15thMar
News article

HMRC urges working families to save on childcare costs

HMRC is urging working parents to make use of its Tax-Free Childcare (TFC) scheme to help save on Easter childcare costs.

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HMRC is urging working parents to make use of its Tax-Free Childcare (TFC) scheme to help save on Easter childcare costs.

It stated that working families can save up to £2,000 a year per child, or £4,000 if their child is disabled, on childcare bills under TFC.

The scheme helps parents to pay for approved childcare for children aged 11 or under, or up to 16 if the child has a disability. HMRC is reminding families that they can receive up to £500 every three months – for every £8 paid into their online TFC account, they will automatically receive an additional £2 top up from the government.

TFC can be used to help pay for childminders, nurseries, breakfast and after school clubs, HMRC said.

Myrtle Lloyd, Direct General for Customer Services at HMRC, commented: 'Springtime is a good opportunity to take a fresh look at family finances. A quick check online and you can find out how TFC can help cut the cost of your childcare bills. Every bit of financial support helps – I would urge families to 'hop to it' and search 'Tax-Free Childcare' on GOV.UK to find out how you could be better off and open your account today.'