Tag: Treasury

The press release issued by HM Treasury on 30 January 2023.

David McGuinness, 41 of the Sutton Coldfield area of Birmingham, was sole director MC-Dalt Scaffolding Services Ltd, which was incorporated in 2017 with its registered office in Erdington in Birmingham.

In May 2020, McGuinness applied for and received a Bounce Back Loan of £50,000 on behalf of the company. Bounce Back Loans were a government scheme to help keep businesses afloat during the Covid-19 pandemic, whereby companies could apply for loans of up to 25% of their 2019 turnover, up to a maximum of £50,000.

He then applied to dissolve the business two months later, which led to the Insolvency Service opening an investigation.

Investigators found that McGuinness had stated the company’s turnover as nearly £300,000 when its accounts for 2019 showed turnover of less than £20,000. The company would therefore have only been entitled to a Bounce Back Loan of around £4,000.

Compounding this, instead of using the Bounce Back Loan money for proper company use, the day after receiving the funds he instead transferred nearly £15,000 out of the company’s account, with the bank reference ‘Dave’. A further £35,000 was transferred to various third-parties.

When applying to dissolve the company, McGuinness was legally required to notify interested parties and creditors, such as a bank with an outstanding loan, within seven days and that a failure to do so could result in a criminal prosecution. He did not follow this advice however.

On 13 December 2022 the Secretary of State for Business, Energy and Industrial Strategy accepted a disqualification undertaking from David McGuinness after he did not dispute he had abused the Bounce Back Loan scheme by claiming money to which his business was not entitled.

His ban lasts for 11 years and began on 3 January 2023. The disqualification prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court.

Peter Smith, Deputy Head of Insolvent Investigations at the Insolvency Service, said:

The Bounce Back Loan scheme was set up to support businesses in genuine need during the pandemic, and David McGuinness clearly abused it by making false declarations to his company’s bank.

This lengthy disqualification is a sign that we take such abuse extremely seriously and will act to tackle wrongdoing by these directors.

The press release issued by HM Treasury on 27 January 2023.

HM Treasury and the Bank of England are opening the Energy Market Financing Scheme (EMFS) for applications.

The EMFS was announced on 8 September, and in The Growth Plan the then Chancellor confirmed that it will provide a 100% guarantee to commercial banks to provide additional lending to energy firms.

Delivered with the Bank of England, this scheme addresses the extraordinary liquidity requirements faced by energy firms operating in UK wholesale gas and electricity markets as a result of margin calls.

Energy prices have been high and volatile this year. As a result, large amounts of collateral are required to enter into contracts firms use to effectively insure themselves from price fluctuations, or otherwise firms must accept large credit exposures to their counterparties.

The details of the scheme were announced on 17 October, and firms can apply via the Bank of England.

The application window will remain open until noon GMT on 27 January 2023; however, guarantees will last for 12 months from when an application is approved. Firms are encouraged to engage the Bank of England in advance of the deadline if considering an application as part of forward planning at: EMFS-Applications@bankofengland.co.uk.

The scheme is aimed at providing a backstop to support energy firms facing large and unexpected margin calls. Pricing and conditions will reflect this objective. The scheme will provide resilience to energy markets and therefore help to reduce the eventual cost for businesses and consumers.

Further details on the structure of the scheme can be found on the Bank of England’s website and the market notice. To apply to the scheme please contact EMFS-Applications@bankofengland.co.uk

Scheme Eligibility

As part of the application process, firms will need to demonstrate that they meet the eligibility criteria.

The EMFS is intended to support energy firms  who are facing short term liquidity challenges but would be otherwise in sound financial health. Eligibility will be considered based on the following criteria:

• Firms must demonstrate they are in sound financial health (firms must be otherwise solvent and solvency will be assessed through robust due diligence processes)
• Firms must be licenced by either Ofgem (or have an entity in the Energy Firm’s group that is Ofgem-licenced) or the Utility Regulator in Northern Ireland (or have an affiliate of the Energy Firm that is licenced by the Utility Regulator of Northern Ireland)
• Firms must also have a pre-existing relationship with an approved commercial bank or banks

In addition, firms must also demonstrate they are making a material contribution to UK energy markets, in line with criteria set out in the market notice.

Eligibility will be assessed by the Bank of England and an Advisory Committee convened by HMT, who will make a recommendation for the Chancellor to make a decision to approve or reject each application.

Eligible firms who wish to apply for a guarantee will be required to comply with a set of policy conditions, such as restrictions on executive pay and capital distributions, when they draw down on the facility. For the full list of conditions, please refer to the market notice.

Energy firms that are ultimately owned by banks, building societies, insurance companies, and other financial sector entities regulated by the Bank of England or the Financial Conduct Authority will not be eligible. Firms within groups that are predominantly active in business subject to financial sector regulation will also not be eligible.

Energy firms will not be eligible if state-owned entities, national governments, regional governments and/or municipalities hold, directly or indirectly, more than 25 per cent of its issued securities and/or voting rights, and/or if such entities exercise direct or indirect control over the energy firm.

If the ownership of the firm changes so that the above criteria for exclusion are met, no further loans shall be advanced under the scheme.

Application process

Firms can apply to the scheme for the next three months. Each loan facility agreement will last up to 12 months and will begin from when the guarantee is issued by the commercial lender.

Applications will be assessed initially by the Bank of England, and then by Advisory Committee, who will make a recommendation for the Chancellor to decide whether to approve or reject an application.

To apply for the scheme, please email EMFS-Applications@bankofengland.co.uk. For further details on the scheme, please visit here.

The press release issued by HM Treasury on 27 January 2023.

Chris Skidmore has been appointed to help accelerate the development and deployment of emerging technologies in key UK growth sectors.

• Rt Hon Chris Skidmore MP has been appointed by the Chancellor to support Sir Patrick Vallance’s work to accelerate the development of emerging tech
• a former Minister for Energy and Clean Growth, Chris Skidmore will advise on new regulations to promote innovation
• Chris Skidmore’s appointment comes shortly after he published Mission Zero, the independent review of net zero

Five leading experts have already been appointed to support Sir Patrick Vallance, working with industry to identify any barriers to innovation and getting emerging technologies to market.

Chris Skidmore will support Jane Toogood on green industries, such as Zero Emissions Vehicles and energy infrastructure.

Chris Skidmore is Chair of the government’s independent Net Zero Review and the Conservative MP for Kingswood. He has previously held positions as Minister of State at the Department for Business, Energy and Industrial Strategy, at the Department for Education, and at the Department of Health and Social Care.

His Mission Zero review identified the critical role that technologies such as hydrogen, fusion, and carbon capture and storage will have in achieving net zero, and these all will require agile regulatory approaches so that they can be deployed rapidly and safely in the UK. Chris Skidmore will bring insights from his review to Sir Patrick Vallance’s work.

As set out at the Autumn Statement, the Government Chief Scientific Adviser and National Technology Adviser, Sir Patrick Vallance, is reviewing existing rules to develop a pro-innovation regulatory approach that allows the UK to fulfil its ambition to become a science superpower and world leader in key growth sectors, including green industries.

The press release issued by HM Treasury on 27 January 2023.

Chancellor Jeremy Hunt today set out his vision for long-term prosperity in the UK, calling on businesses in key growth areas to invest in the UK and expressing his desire to make the UK an attractive site for innovators and entrepreneurs.

Chancellor Jeremy Hunt called on businesses to invest in the UK and promised long-term thinking to make the UK the next Silicon Valley

– he outlined a vision to drive for growth as one of the government’s five priorities – doing so by encouraging enterprise, tackling poor productivity, and getting more people into better paid jobs right across the country

– digital technology, green industries and life sciences among those identified as growth sectors that can help realise a more innovative economy

Speaking at Bloomberg’s European headquarters in London, the Chancellor opened his speech on the economy by highlighting one of the UK’s major growth sectors – technology – before revealing that the opening section of his speech had been written by ChatGPT, the AI software that was released late last year.

Getting the economy growing faster is one of the government’s five priorities, as set out in Prime Minister Rishi Sunak’s New Year address. Mr Hunt outlined how he intends to deliver upon that over the coming years, ahead of the Spring Budget due on 15th March.

The Chancellor Jeremy Hunt said:

“Our plan for this year remains to halve inflation, grow the economy and get debt falling.

“But all three are essential building blocks for much bigger ambitions for the years beyond.

“World-beating enterprises to make Britain the world’s next Silicon Valley.

“An education system where world-class skills sit alongside world-class degrees.

“Employment opportunities that tap into the potential of every single person so businesses can build the motivated teams they need.

“And opportunities spread everywhere just as our talent is spread everywhere.”

The Chancellor went on to call on businesses in the key growth sectors of Digital Technology, Green Industries, Life Sciences, Advanced Manufacturing and Creative Industries to increase their investment in the UK, with the Chief Scientific Adviser Sir Patrick Vallance already leading work on how we should change regulation to better support safe and fast introduction of new emerging technologies.

The Chancellor added:

“If anyone is thinking of starting or investing in an innovation or technology-centred business, I want them to do it in the UK. I want the world’s tech entrepreneurs, life science innovators, and clean energy companies to come to the UK because it offers the best possible place to make their vision happen.

“And if you do, we will put at your service not just British ingenuity – but British universities to fuel your innovation, Britain’s financial sector to fund it and a British government that will back you to the hilt.”

Digital Secretary Michelle Donelan said:

“I believe that Britain is uniquely placed in the world to become the number one home for tech – one where entrepreneurs have both the stability, but also the freedom, to invest and innovate.

“We have a clear vision for where this country is going, and a government that is prepared to match that ambition with action. That’s why this year we’re bringing forward new laws to transform digital markets, free up businesses to innovate with data, and set out our strategy for globally important semiconductors.”

Business Secretary Grant Shapps said:

“We stand at the cusp of a new age, facing a technological revolution that will transform the world as deeply as the industrial revolution did in the nineteenth century.

“The UK has an opportunity to be at the forefront of this revolution, building upon our world-class research infrastructure and open markets to scale up the business titans of the future here in Britain, in everything from AI to quantum, from robotics to biotechnology.”

The Chancellor set out his aim to increase enterprise, supporting businesses by using our new-found Brexit freedoms to review regulations in key growth sectors to make it easier for companies to innovate, alongside the importance of competitive business taxation.

He reiterated the importance of employment and tackling economic inactivity, helping more people into work and filling the vacancies in the jobs market. He also outlined ambitions to help more disabled people and those with mental illnesses into work, and a pensions system that encourages continued workforce participation. The Work and Pensions Secretary is thoroughly reviewing issues holding back workforce participation, with a report due to conclude shortly.

The Prime Minister and the Chancellor have both placed enormous importance on education, with £2.3 billion of additional funding for 23-24 and 24-25 announced at the Autumn Statement and continued implementation of the government’s skills reforms. The government has already made progress with T-levels, boot camps and apprenticeships.

And finally the aim of levelling up everywhere across the UK, ensuring that all areas feel the benefits of economic growth with empowered local areas and reducing the time it takes to build new infrastructure. Already the Levelling Up Fund has awarded £3.8 billion to projects across the UK and the UK Government is working to launch Freeports in every country in Britain, with several already operating in England and the locations of two having recently been announced in Scotland.

The Secretary of State for BEIS Grant Shapps and Secretary of State for Culture Media and Sport also delivered keynote speeches at the event.

The press release issued by HM Treasury on 26 January 2023.

Following two separate cases brought by the Insolvency Service, two directors were given suspended prison sentences of 20 months and six months respectively.

Sameer Saeed, 42, from London and Antonia Parkes, 35, from Conwy, have each been convicted for offences under the Companies Act, after being found to have abused the Bounce Back Loan financial support scheme in 2020.

Sameer Saeed was convicted on four counts under the Companies Act and Fraud Act following an Insolvency Service investigation.

Saeed was sole director of Digital Business Box Ltd and The Home Wills Ltd. In relation to the former, he secured a £50,000 Bounce Back Loan based on inflated turnover, and applied to dissolve the company two weeks later. In relation to the latter, he attempted to secure a £50,000 Bounce Back Loan although the company had only been established on 31 March 2020 and was therefore not eligible for any funding through the scheme. He did not receive the funds, but his attempt to secure a second loan was deemed an aggravating aspect in court.

He pleaded guilty to offences under the Companies Act as well as fraud offences. Saeed was sentenced at Snaresbrook Crown Court on 21 December 2022 to 20 months imprisonment, suspended for 18 months, and 300 hours of unpaid work. He has undertaken to repay the £50,000 Bounce Back Loan to the bank.

In a separate case, Antonia Parkes was convicted of an offence under the Companies Act.

She was director of Conwy Valley Lodge Ltd, which ran a hotel close to Snowdonia in Wales. The company situation deteriorated after the start of the pandemic, and she sought financial assistance from the government. Through the Bounce Back Loan scheme, genuine businesses impacted by the pandemic could take out interest-free loans of up to £50,000.

The Insolvency Service investigation found that Parkes had secured a £20,000 Bounce Back Loan, immediately before she applied to dissolve the company.

The striking-off application to dissolve the company was explicit that interested parties and creditors, such as a bank with an outstanding loan, must be notified within seven days of making an application to dissolve a company. The form also highlighted that failure to notify interested parties is a criminal offence, however Parkes did not heed this warning.

She was sentenced on 14 December 2022 at Llandudno Magistrates Court to 26 weeks’ imprisonment suspended for 12 months, with an unpaid work requirement of 120 hours.

Julie Barnes, Chief Investigator at the Insolvency Service, said:

In each of these two cases the company directors thought they could abuse the rules to exploit a scheme, backed by taxpayers, designed to help businesses get through the pandemic.

We will not hesitate to prosecute these cases, and they both now have criminal convictions as a consequence of their actions.

The press release issued by HM Treasury on 26 January 2023.

Mathius Thompson, 33, from Birmingham, Moira Wood, 47, from Lightwater, Guildford, and Ioan Adrian Mociar, 35, from Harrow have been banned for a total of 30 years after separate investigations found they had abused the Bounce Back Loan scheme during the Covid-19 pandemic.

Mathius Thompson was the sole director of West Midz Cars Ltd in Ladywood, Birmingham. In May 2020 he applied for a Bounce Back loan of £50,000 for his used car dealership.

Bounce Back Loans were a government scheme to help keep businesses afloat during the Covid-19 pandemic. Under the rules of the scheme, companies could apply for loans of up to 25% of their 2019 turnover, up to a maximum of £50,000. All loan money had to be used for the economic benefit of the business.

Thompson stated in his loan application that the dealership’s turnover for 2019 was around £287,500, and received the maximum £50,000 loan for the company. But the business went into liquidation in August 2021 owing £53,500, including the full amount of the Bounce Back Loan, which triggered an investigation by the Insolvency Service.

Investigators discovered that West Midz Cars Ltd’s turnover in 2019 had been just over £2,500 and the company’s bank statements for that year show no income or trading activity, meaning the business had not been entitled to a loan.

The company accounts also showed no evidence that the money had been used for the economic benefit of West Midz Cars. A compensation order of £50,000 is now being sought, to repay the loan provider.

Moira Wood, who was sole director of her IT consultancy, Clockwork Compliance Services Ltd, in Guildford, Surrey, applied for a £24,000 Bounce Back Loan for her company in September 2020. The business went into liquidation in February 2022, owing £55,800, including the full amount of the loan, and triggering an Insolvency Service Investigation.

Investigators discovered that Wood had transferred £23,400 to herself between October 2020 and January 2022, just before the company folded, with no evidence that the money had been used for the benefit of Clockwork Compliance Services.

And Ioan Adrian Mociar, who was sole director of Midi Construction Ltd in Pinner, Harrow, applied for a £41,000 Bounce Back Loan for his building company, after stating on the application that the business’s turnover in 2019 had been £166,000. Under the rules of the scheme, if a business began trading after 1 January 2019, the estimated annual turnover could be used.

When Midi Construction Ltd went into liquidation in December 2021 with debts of around £46,000, including the full amount of the loan and almost £5,000 owed to HMRC, it triggered an investigation by the Insolvency Service.

Investigators found that as the building company had only begun trading in June 2019, accounts showed that its turnover for the year ending 31 May 2020 was around £45,500. Midi Construction had therefore received around £29,600 more than it was entitled to under the rules of the loan scheme.

They also discovered that payments of more than £39,700 had been made from Midi Construction Ltd’s bank account during a three-week period between October and November 2020, without any evidence to show that they were for the economic benefit of the company.

The Secretary of State for Business, Energy and Industrial Strategy accepted disqualification undertakings from the three directors after they did not dispute that they had caused their companies to either:

• provide misleading information to a bank to obtain a Bounce Back Loan when they knew or ought to have known that their business was not eligible for a loan of the amount claimed
• and/or not provide evidence to show that payments from the company bank accounts were used for the economic benefit of the company.

Ioan Mociar’s disqualification runs for 11 years from 6 January 2023. Moira Wood is banned for 8 years from 30 January 2023, and Mathius Thompson is banned for 11 years, also from 30 Jan 2023.

The disqualifications prevent them from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court.

Tom Phillips, Assistant Director of Company Investigations at the Insolvency Service, said:

The Bounce Back Loan scheme was designed to support businesses in genuine need. These three company directors abused taxpayers’ money to either apply for loans to which they weren’t entitled, or by failing to show that the money they claimed had been used to support their companies.

They have been removed from the corporate arena for a total of 30 years, and their disqualifications should serve as a reminder to others that the Insolvency Service will take action to protect the public and the taxpayer.

• West Midz Cars Ltd traded as a used car salesroom at Great Tindle St, Ladywood from its incorporation in January 2016 until it went into liquidation in August 2021.
• Clockwork Compliance Ltd traded as an IT consultancy firm in Guildford from its incorporation in January 2018 until it went into liquidation in February 2022.
• Midi Construction Ltd traded as a building company in Pinner, Harrow from its corporation in in May 2019 until it went into liquidation in December 2021.

The press release issued by HM Treasury on 13 January 2023.

The Government has today (13 January) launched a consultation to simplify the UK’s R&D tax relief system, drive innovation and grow the economy.

The press release issued by HM Treasury on 12 January 2023.

HMRC has today revealed that more pensioners filed a tax return for the 2020 to 2021 tax year compared to young people.

Overall, those aged 65 and over accounted for 16% of individuals who submitted a tax return, whereas 16 to 24 year olds made up 2.7% of total filers.

The new data is part of analysis by HMRC into the demographic data of the Self Assessment population. The findings also show:

• people aged 45 to 54 were the largest group of filers, accounting for 24% of all tax returns submitted
• more than 294,000 16 to 24 year olds filed a return, making up 2.7% of total filers
• 62% of those who submitted a return last year were men, compared to 38% who were women

The data also showed that almost 146,000 people submitted their tax return at the earliest opportunity between 6 and 11 April 2021.

More than 12 million people are expected to file a Self Assessment tax return for the 2021 to 2022 tax year. Anyone yet to submit theirs has until 31 January to complete it, pay any tax owed or set up a payment plan, or risk having to pay a penalty.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

Time is running out for anyone who has yet to start their tax return – there is a wide range of guidance and webinars available online for those who need a helping hand. Just search ‘Self Assessment’ on GOV.UK to make a start.

Payments are also due on 31 January and customers still have time to decide which payment option is best for them. For customers who are due a refund, they should include their bank account details in their tax return so that if HMRC needs to repay them, it can be done quickly and securely.

The press release issued by HM Treasury on 11 January 2023.

Darren Richard Baker, based in Coventry, has been disqualified as a director for 7 years after he wrongfully took out a £45,000 Bounce Back Loan on behalf of his charity in October 2020. He then secured a further £5,000 top-up for the charity in March 2021.

Baker was director and chair of The Leanne Baker Trust, a charity set up to campaign to support people struggling with their mental health.

The charity was established in 2014 but went into liquidation in September 2021.

Although charities were eligible to apply for financial support during the pandemic through the Bounce Back Loan scheme, The Leanne Baker Trust had no overheads or employees.

Baker stated that the charity’s turnover was £200,000 in order to secure the Bounce Back Loan, yet its annual accounts showed a maximum turnover of £26,029 for the calendar year 2019. Under the rules of the scheme, the charity was therefore not eligible for the funding.

Having received the funding, Baker did not use the money to support the charity, but instead used over £25,000 to pay off personal legal fees, and a further £13,000 for personal use.

The Liquidator reported the Bounce Back Loan misuse to the Insolvency Service when the charity went into liquidation, and has subsequently recovered the full amount.

The Secretary of State for Business, Energy and Industrial Strategy accepted a disqualification undertaking from Darren Baker, after he accepted that he caused The Leanne Baker Trust to obtain a Bounce Back Loan that it was not entitled to. His ban is effective from 15 December 2022 and lasts for 7 years.

The disqualification undertaking prevents him from directly, or indirectly, becoming involved in the promotion, formation or management of a company, without the permission of the court.

Rob Clarke, Chief Investigator at the Insolvency Service, said:

Bounce Back Loans were offered to businesses that had been negatively impacted by the pandemic, with the money purely to be utilised for the economic benefit of those companies; safeguarding jobs and sustaining entrepreneurial activity. That clearly was not the case in this instance where the funds have been claimed by a charitable enterprise, with negligible turnover, and no employees.

Despite the humanitarian purpose of the trust as established, Darren Baker took advantage of the support available during this difficult time for his own personal gain. His disqualification should serve as a warning to others that the Insolvency Service will take action whenever a director’s dishonesty threatens loss to the public purse, the consequence being a lengthy exclusion from trading with the benefit of limited liability.

The press release issued by HM Treasury on 11 January 2023.

HM Revenue and Customs (HMRC) is changing the way taxpayers who use a repayment agent can receive overpaid tax to protect them and raise standards among repayment agents.

HMRC will introduce legislation to change the way repayment agents are paid for their services and better protect customers from the unscrupulous tactics used by some operators. This means stopping the use of legally binding ‘assignments’ as part of claiming an Income Tax repayment, which could only be cancelled if the agent and taxpayer both agreed to do so. This can be challenging for customers who become dissatisfied with their agent, or who simply wish to take over managing their own claim.

Under new arrangements, if a taxpayer chooses to use a repayment agent to reclaim overpaid tax and wants it sent to the agent, they will need to make a nomination, which they can cancel at any time. The new process will make it easier for taxpayers to stay in control of their repayments.

Angela MacDonald, HMRC’s Deputy Chief Executive and Second Permanent Secretary, said:

Taxpayers deserve better – we want to make sure they are better protected before choosing to enter into an agreement with a repayment agent. HMRC’s updated standards for agents will level the playing field and provide the benchmark we expect all repayment agents to meet.

The changes follow HMRC’s consultation last summer on ‘Raising standards in tax advice: Protecting customers claiming tax repayments’. Responses to the consultation highlighted the need to improve agent transparency and standards with the overall aim of better protection for taxpayers.

As a result, HMRC is today also setting out the following measures:

• updated standards for agents – applicable to all tax agents and include greater transparency requirements
• a new HMRC registration process for repayment agents – to make the agent sector more transparent so customers better understand what they are signing up to

Victoria Atkins, Financial Secretary to the Treasury, said:

For too long taxpayers have been left in the dark as a result of misleading and opaque agreements with repayments agents. These new measures will ensure those who are entitled to claim a tax repayment or relief can do so freely and easily – whether they choose to do this themselves or by using an agent.

This government is making it easier to navigate the system for all taxpayers using an agent to claim money that’s owed to them.

Victoria Todd, Head of the Low Incomes Tax Reform Group, said:

We welcome these additional steps, which show HMRC recognises the important role they play in consumer protection. Refund companies have a legitimate role in the tax system, but the practices of some of these companies in recent years have been unacceptable. The proposed changes will hopefully address problems around the use of assignments, increase transparency for taxpayers and set clearer standards for these companies’ behaviour.

Alongside this, it is important that more effort goes into raising awareness of refunds and ensuring it is as simple as possible for taxpayers to access them. We look forward to working with HMRC on the detail of the proposals.

These changes form part of the government’s commitment to tackle problems in the repayment agent market, which is currently an unregulated sector.

Responses to HMRC’s recent consultation overwhelmingly supported the need for improving standards in the repayment agent sector. The updated HMRC standard for agents includes:

• greater evidence of customer consent – this aims to ensure that taxpayers better understand the agreement they’re entering into
• stricter transparency rules, including introducing a 14-day ‘cooling off’ period for customers after entering into an arrangement with an agent, and an obligation on agents to ensure all communications and advertising material are fair, clear, accurate and do not mislead or conceal material facts

Further details on the approach to registration for repayment agents will be set out in due course.

If taxpayers think they are owed a tax rebate, they can claim directly from HMRC via the free and secure service on GOV.UK and will receive 100% of the money owed.