Bank of England raises UK interest rates to 13-year high

The Bank of England (BoE) has raised UK interest rates to a 13-year high of 1.25% and is now predicting inflation will hit 11% this autumn, when energy bills are set to rise again. Six out of nine Monetary Policy Committee (MPC) members voted for a 0.25 basis point hike, leading to a fifth consecutive rise. It is the first time since January 2009 that the rate has been higher than 1%. Three members of the MPC voted to raise…

Four out of five employers stated that they were immediately impacted by the increase in national insurance contributions (NICs), according to research by the British Chambers of Commerce (BCC). The BCC surveyed more than 1,100 UK employers and found that the NICs increase has caused negative impacts to 81% of businesses. Firms said the rise in employer NICs from 13.8% to 15.05% has increased staffing costs, forced some to put up their prices and meant they would be limiting their…

Manufacturing trade body Make UK is calling for an emergency, pre-recess package of business support measures. The call comes after a Make UK survey showed growth and orders slowing significantly with exports close to a standstill. Make UK has made recommendations for measures the government can introduce now to address rising business costs, including: waiving or reducing business rates for the next 12 months implementing VAT deferrals for larger businesses and waiving completely for SMEs temporarily freezing the Climate Change…

HMRC has published the latest issue of the Employer Bulletin. The June issue has information on various topics, including: PAYE paying Class 1A National Insurance contributions due on 22 July 2022 Enterprise Management Incentive: Covid-19 easement ending Save as You Earn: Covid-19 easement ending guidance on how tips, gratuities and service charges are taxed. Please contact us for help with tax matters. Internet link: Employer Bulletin

Rishi Sunak, the Chancellor, will impose a windfall tax on energy companies as part of a package to help consumers cope with the cost-of-living problem. Mr Sunak stated that a ‘temporary, timely, and targeted’ 25% Energy Profits Levy would be imposed on oil and gas corporations to reflect their enormous profits. The charge is estimated to raise £5 billion for the Treasury, and the legislation will include a sunset clause to ensure that it is only in place for a…

According to the UK’s energy regulator, the energy price cap will rise to about £2,800 in October. Ofgem Chief Executive Jonathan Brearley warned MPs on the Commons business committee about the rise. Due to continuous volatility in the gas market, Mr Brearley told the committee that the price cap, which is presently £1,971, will be increased. He described the price increases as a once-in-a-generation occurrence not witnessed since the 1970s oil crisis. The Chief Executive of Ofgem has expressed concern…

According to the latest numbers from the Office for National Statistics, inflation has reached its highest level in 40 years as the cost-of-living problem worsens (ONS). Last month, the rate jumped to 9%, the highest level since similar figures from 1982. The ONS reported a broad-based increase in prices for ordinary goods and services in April, with the unprecedented 54 percent increase in the energy price cap, which went into effect at the beginning of the month, accounting for a…

According to HMRC data, around 66,500 people filed their 2021/22 self assessment returns on the first day of the new tax year. In previous years, the number of ‘early-bird’ customers filing their completed self-assessment tax returns at the start of the new tax year has increased – about 30,000 more customers filed their forms on April 6 this year than in 2018. Others are being encouraged by HMRC to improve their filing habits as soon as possible. Although many people…

The Queen’s Speech, delivered at the official opening of parliament on May 10, proposed new regulations to protect access to cash and assist victims of financial frauds. The new Financial Services and Markets Bill will ensure that withdrawal and deposit services are available throughout the United Kingdom. The Payment Systems Regulator will be allowed to order banks to recover authorised push payment (APP) fraud losses, which amount to hundreds of millions of pounds each year, under the terms of the…

According to a report produced by the Department for Business, Energy and Industrial Strategy (BEIS), HMRC issued 580 fines totalling over £14 million for minimum wage violations in 2020/21. Penalties for non-compliance with the national minimum wage (NMW) and national living wage (NLW) have decreased by £4.5 million from the previous year, when 992 penalties totaling £18.5 million were issued. According to the BEIS research, HMRC has changed its messaging to make it clear to employees that they can remain…