Changes to Child Benefit, a mammoth accounting error at Cambridge City Council and a smartphone you can use in the shower (yes, really) all made the headlines this week. Steven Perryman scours the week’s news
1. Tax – Coalition blows the whistle on Child Benefit at half time
It’s the start of a new year, but there’s no time to even pause to draw up your diet plan in the world of tax. Especially if you’re a parent or self-employed. And if you’re a self-employed parent? Well, the Christmas paunch will definitely have to wait another month.
This week the government’s changes to Child Benefit came into effect. As a result of the changes families with one parent with a taxable income of more than £50,000 will lose some of the benefit, whilst it will be withdrawn entirely if one parent earns above £60,000. It is an initiative that has rightly caused a stir with many, including AAT’s Adam Harper, arguing this week that the changes are unfair.
Meanwhile, the deadline for Self Assessment tax returns – 31 January – draws ever closer, with Accountancy Age warning that the vast majority of taxpayers will put the job off until the last minute. Guys, you have been warned.
With the hornets nest well and truly kicked thanks to the Child Benefit furore, it was rather unfortunate that this week also marked the half-way point of the coalition government. The half time oranges turned a little sour when Labour leader, Ed Miliband, picked over the first half audit during this week’s Prime Minister’s Questions like football pundit Alan Hansen going to town on a 4-4 draw.
Over in the tax avoidance corner 2013 has begun sluggishly, although a murmur of a new controversy appeared in the form of IT companies. According to Charlie Elphicke MP, a former tax lawyer with Hunton & Williams, a group of ten technology companies with government contracts – including IBM, Microsoft and Dell – significantly underpay their corporation tax. One to watch.
Financial Director reported that HMRC has revealed that in 2012 it caught 32 of its top tax dodgers who have been banged up for a combined 152 years. Meanwhile, on the other side of the Channel the result of raising taxes has caused controversy, with news that French actor, Gérard Depardieu, has announced that he is to become a Russian citizen in a row over French taxes that the actor believes are ‘punishing success, creation and talent’. The resulting switch led to dinner with Russian President, Vladimir Putin, this week:
North of the border there have been calls for a tax to be levied on each bottle of Scotch whisky, to give its country of origin a greater share in its growing success. Coming so soon after the well-lubricated Christmas period, you can’t help but feel they may have missed a trick.
2. Accountancy – first class accounting errors from Cambridge City Council and the Post Office
Ever miscalculated the weekly food shop or your beer money on a night out? We’ve all been there. So spare a thought for the number-crunchers at Cambridge City Council, where auditors Ernst & Young has found that an error in its accounts has left its proposed budget short.
But we all make mistakes, right? Of course. The figure it is short by? Just the small matter of £2.3m. Watch out for that Council Tax rise anytime soon.
The Council is not alone. This week AccountingWEB reported that the Post Office is to investigate whether accounting software used by its branches is to blame for unexplained losses (note: it might also be your long queues and mis-sold services).
Due to errors, postmasters and mistresses have had to pay for discrepancies, have been fined or in some cases imprisoned. Blimey. No wonder close to 100 subpostmasters and mistresses have registered an interest in suing the Post Office regarding the computer system.
3. Technology – Smartphones get bigger. And wetter
Over in the world of technology, geeks and tech fanatics the world over have descended on Las Vegas for a week of sun, cocktails, gambling and, er, technology developments at the annual CES show.
One of the eye-catching product launches has been a new smartphone from Sony that can be used in the shower or bath without the risk of damage. The mind boggles at the sort of applications that might attract.
But maybe Sony is onto something. Especially with news that, according to a study by accountants Deloitte, the smartphone will become an everyday object worldwide this year, bringing the number of active phones with either a touch screen or an alphabet keyboard to 2bn.
With the CES show casting a spotlight on the technology industry, spare a thought for the poor PR people at Microsoft. This week it was reported that thieves raided the technology giant’s Silicon Valley offices over Christmas.
Bad timing all round, especially when it was revealed that the thieves only stole five iPad’s – a product of its rival, Apple – rather than anything made by the company. Oh dear.
4. And finally…ditch the Christmas paunch. Whilst at work
Still struggling to shift the Christmas paunch? News this week that the world throws up to half of its food away is worrying, but hard to fathom so soon after the season of goodwill and gluttony.
But if eating just half of your Christmas supplies (whilst throwing the other half away) has led to a little loosening of the belt and a commitment to a ‘dry-athlon’ in January, then help is at hand. Forget Davina McCall and Josie Gibson (you know, her off Big Brother). Instead, Dr John Buckley is your man.
According to Buckley, a doctor from the University of Chester, office workers trapped behind their desks all day should push away their chairs and start working standing up. Doing this for three hours extra a day, he believes, can shift 8lb (3.6kg) of fat a year.
You heard it hear first: it’s okay to leave your desk regularly throughout the day. Your beach body depends on it.
Steven Perryman is AAT Comment's former Content Editor.