Frankly, a large proportion of general practice solicitors simply do not appreciate the importance of being highly visible on the internet. Personal Injury specialists have been ahead of the game in this area for years, as are accountants and others who are obtaining all the legal leads instead of law firms. This domain, solicitors-swindon.co.uk, is powerful enough to compete both for a full range of local search terms (not just a few as is the case with many others) and we are seeking a single, suitable law firm in the Swindon area to partner up with us on this site. If you believe you are a suitable, progressive firm, please get in touch.
Archive for the ‘Uncategorized’ Category
Small Claims reform update
Expansion of small claims limits – good or bad ?
The Ministry of Justice (MoJ) has launched a consultation about the possibility of increasing the limit for small claims from £5,000.00 to £15,000.00 and all small claims being automatically subject to mediation.
MoJ research indicates that increasing the small claims limit would increase the number of small claims by around 12,000. The current number of small claims is around 93,000 per annum.
There are undoubtedly some advantages of small claims, principally speed and simplicity of process and the lack of risk on costs. However, part of the agenda could also be to soften the opposition to legal aid cuts. Many cases which are valued at less than £15,000.00 still involve complex areas of law and such a move could also encourage defendants to string out claims in the knowledge that they are unlikely to be penalised on costs.
What is crystal clear is that this Government is intent on radical reform of the civil justice legal system.
Law, politics and criminal law
“Discounted” sentences become hot political potato
As many will have noted this week, the justice secretary, Kenneth Clarke, made some controversial comments about rape, but these were made in the wider context of the political and moral issue f whether criminal sentences should be further discounted for an early guilty plea and contrition.
As things stand, many crimes, where the defendant pleads guilty at the earliest opportunity, involve a reduction in usual sentence tariff of a third. Ken Clarke has been suggesting that this may be increased to a 50% reduction. Due to the bad publicity from his comments this week, it looks as though the debate on this issue will now go on the backburner for a few months at least. This is a good example of how politics and law, when it comes to criminal law, are not easy bedfellows.
Divorce simplified
Often the law can seem complex to non-lawyers simply because of the use of technical language which is also old fashioned. Over the last decade there have been gradual changes brought in to make the terminology used simpler and this is definitely welcome and has now been extended to divorce law.
The following changes have been made which will, it is hoped, help the participants in family proceedings better understand the process.
Old legal term New legal term
Ancillary relief Financial order
Divorce decree Matrimonial orders
People without mental capacity Protected parties
Guardian ad litem Children’s guardian
Next friend Litigation friend
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CFOs Less Optimistic
Chief financial officers (CFOs) are increasingly concerned that the UK may be headed for a ‘double-dip’ recession, according to a survey by accountants Deloitte.
The survey found that 29 per cent of CFOs predicted a double-dip and that optimism is at the lowest level in two years.
If you are concerned about difficulties with collecting debts, meeting your financial obligations, the availability of finance or protecting your business from trade risk we may be able to help.
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Royal Wedding Boozy Weekend in Store
The House of Lords has approved regulations allowing pubs to stay open late on 29 and 30 April to mark the Royal wedding.
They will enjoy an extension until 1 am on the night of Friday 29/ Saturday 30 April and the night of Saturday 30 April/ Sunday 1 May.
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The Budget – Issues For Individuals
Budget Summary 2011 23 March 2011
With Chancellor George Osborne caught between a rock and a hard place as regards the yawning public sector deficit, it was perhaps inevitable that the Coalition’s belief that the best way to fix the problem is to stand firm against its doubters would underpin the measures contained in the Budget. Time will tell if the strategy is correct but, in the meantime, the Chancellor has left some tax planning opportunities open. In some cases, the door of opportunity slams shut on 5 April 2011, so if any of the below have resonance with you, get in touch fast!
In this bulletin we are concentrating on the unexpected changes and those most likely to demand action by the reader.
Before you undertake any tax planning or mitigation exercise, take professional advice.
Summary of Changes Affecting Private Individuals
Income Tax (IT)
Allowances generally will in future be uprated in line with the Consumer Prices Index.
Higher-Rate Tax
The tax-raising effectiveness of the 50 per cent band is being reviewed. If it proves to be ineffective, it will presumably be reduced in the next Budget, making 2011/12 a good year to top up pensions and the like (although see below). Business expenditure may well attract greater tax relief for expenditure allowable in 2011/12 than subsequently, giving an opportunity to plan spending to maximise tax relief.
If you have a family company with retained profits, it might be worth declaring a dividend now (and making the necessary accounting entries) and reducing dividends taken in 2011/12. This strategy will, however, alter the amount due ‘on account’ of IT for higher-rate taxpayers and will lead to HM Revenue and Customs assessing a larger ‘on account’ payment due on 31 January 2012.
Tax Relief on Pension Contributions
From 6 April 2011, pension contributions that qualify for tax relief will be reduced to an annual allowance of £50,000 instead of the previous limit of £255,000. If you have been considering a contribution to your pension policy that will exceed the limit, there is little time left – but bear in mind the difference in tax rates now and after 6 April.
Enterprise Investment Schemes and Venture Capital Trusts
Clients making investments in Enterprise Investment Schemes and Venture Capital Trusts will welcome the increase in tax relief on such investments – it rises from 20 to 30 per cent on 6 April 2011. Subject to ‘State Aid approval’, the Finance Bill 2012 will greatly increase the amount which can be invested in these schemes by individuals and make them available for investments in bigger firms.
Non-Domicile and Non-Resident Taxation
‘Non-doms’ resident in the UK will be subject to a higher annual charge, of £50,000, if they have lived in the UK for 12 years. The current £30,000 charge will be retained for non-doms who have been resident for at least seven of the past nine years and fewer than 12 years.
The ‘remittance basis’ of assessment for non-doms is being changed to exclude remittances for commercial investment in UK business.
These reforms are intended to come into effect in 2012.
In addition, the present lack of certainty in UK law as to what constitutes ‘residence’ for tax purposes is to be resolved by the introduction of a ‘statutory residence test’. This will probably be based on a ‘physical presence’ test similar to that used in most countries.
National Insurance
National Insurance Contributions and IT are to be combined. A consultation is being put in progress as to how best to achieve this. Pensioners are assured that this will not adversely affect them. The process is expected to take a number of years to complete.
Inheritance Tax (IHT)
The ‘nil rate band’ for IHT (currently £325,000) remains frozen until April 2015.
However, if you leave 10 per cent or more of your net estate (after deducting IHT exemptions, reliefs and the nil rate band) to charity, the Government intends to reduce the rate of IHT charged to 36 per cent as opposed to the standard rate of 40 per cent.
In practice, this may mean some wills have to be reworded to achieve this tax saving as well as the intended benefit for the charity.
Miscellaneous
Savings Income
One of the tax reliefs being abolished from 6 April 2011 is the relief from IT on a NS&I Ordinary Account, which currently exempts the first £70 of interest.
On the plus side, the Government is introducing, for all UK resident children under the age of 18 who do not have a Child Trust Fund account, the ability to have a Junior Individual Savings Account (‘Junior ISA’), similar to an ‘adult’ ISA. This may be an attractive savings vehicle for younger family members.
Tax Co-operation in the EU
New regulations are being introduced in January 2012, based on the EU Directive on administrative co-operation in the field of taxation, which will:
- extend the scope of the current Directive to include all national taxes and duties, local taxes and motor taxes;
- allow tax officials from one Member State to attend or participate in administrative enquiries in another Member State;
- permit information exchanged to be used more widely than at present, subject to certain restrictions; and
- permit a range of national bodies to engage in the mutual assistance process under the general oversight of a Central Liaison Office.
In simple terms, the idea is to make sure taxes owed anywhere in the EU can be pursued anywhere else in the EU.
Charities
Charities will be able to recover the ‘Gift Aid’ tax supplement without paperwork on the first £5,000 of donations received in a year. This will come as a great relief to the trustees of many small charities. However, not mentioned in Mr Osborne’s speech was the fact that the ‘SA Donate’ scheme, whereby taxpayers can donate to charity on their tax return, is being withdrawn.
Pensions
The state pension age will rise to 66 in 2020. Future increases in the state pension age will be based on regular reviews of longevity – a worrying thought for the self-employed in particular. This will inevitably mean longer working lives with an increased risk of illness before retirement age. Permanent health and critical illness insurance will undoubtedly become more widely considered.
Air Passenger Tax (APT)
The proposed rise in APT is being delayed until next year and will be kept under review. However, APT is to be extended to private jets.
Tax Online to be Compulsory
Dealing with your tax affairs online will become compulsory some time between August 2012 and August 2013.
If any of the items in this bulletin apply to you, please get in touch. The end of the tax year is 5 April for individuals and 31 March for companies.
The information contained in this newsletter is intended for general guidance only. It provides useful information in a concise form and is not a substitute for obtaining professional advice.
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Easements & Rights of way
When land is used over a long period of time by persons other than the owner of the land, they may acquire an easement (a legal right to use the land). Easements can be acquired by express agreement also. In that case, the terms of use of the land will depend on the agreement. However, when an easement comes into existence as a result of use, the rights of use are less clear.In a recent case, a dispute arose over the right of way over a private road, which had been used by a farmer for more than 20 years. The court held that the use was effectively unlimited as far as his agricultural purposes went. Since this included driving stock along the road, the owners of adjacent properties opposed it.
The critical point was that although the use of the road by the farmer for pedestrian and vehicular access had been shown to have been permitted for more than 20 years – thus establishing the right of easement – the use for driving stock had not. Since this was more burdensome on the owners of the adjacent properties than pedestrian or vehicular access, the High Court ruled that the right of easement sdid not include the right to drive stock along the road.
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The Equality Act 2010 – Online Starter Guide
The Equality and Human Rights Commission has published an online starter guide on obligations under the Equality Act 2010, for use by those in the private, public and voluntary sectors. The core provisions of the Act came into force on 1 October 2010.
The guide has nine ‘bite-sized’ training modules which concentrate on essential features of the new legislation for employers and for service providers. It is available here.
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Changes to Trust Law
On 6 April 2011, many trusts will cease to be as attractive a vehicle in which to hold assets as they were when they were originally set up and so now is a good time to review any trusts with the proposed changes in mind.
In particular, the position regarding undistributed income in the trust should be given some thought – if there is too much retained income, a tax charge may arise under Section 496 of the Income Tax Act 2007. On the other hand, if the ‘tax pool’ is sufficiently large, delaying a distribution until after the start of the 2010/2011 tax year may be beneficial, although this will depend on the personal tax situation of the beneficiary.
Another planning point is to consider creating a revocable interest in possession for beneficiaries to be put in place before the end of this tax year.
We can advise you on all trust and tax matters.
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