The UK Tax System is to be simplified to attract foreign investment and decrease the burden on businesses

Tax System to be simplified

The Chancellor of the Exchequer, George Osborne is preparing an Office for Tax Simplification to reduce the 11,000 page tax code; due to Britain having one of the most complex tax codes in the world.

It is hoped that the tax code will become more readable and more people will understand the tax laws they are being asked to comply with.

Initially two reviews will be conducted:

  1. The tax system for small business will be simplified
  2. Restructuring of tax reliefs, allowances and exemptions

Tax credits will not be adjusted as they are considered to be part of the benefits system.

It is being simplified in order to make the system more competitive for the growth of small businesses, in hope of stimulating economic growth.

The Chancellor has said:

The previous Government took a complex tax system and made it even worse. A decade of meddling and intervening has made the tax affairs of millions of families and businesses across the UK extremely complicated. We need to sort out this mess.

Two years ago I promised to create the Office of Tax Simplification. Today, we’re delivering on that promise. With its independent, expert advice it will be a permanent force for a simpler tax system.

Simpler, more competitive taxes will help us show the world that Britain is open for business.

Payplan

If you are worried about your finances contact Payplan today on 0800 280 2816, for free and helpful debt advice

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Lenders can turn new arrears rules to their advantage

The regulator’s latest changes to the way lenders should treat customers in arrears – particularly the requirement for lenders to consider all options before starting action to repossess a property – are to be welcomed.

In my experience, mortgage arrears need to be dealt with in the context of the overall financial situation of borrowers.

In trials in which we are working with a small number of lenders to talk to clients in arrears, we have found that by engaging with borrowers about their whole debt situation we’re nearly always better able to effect a solution that stabilises and makes their repayments on unsecured debt more manageable.

This leaves a greater proportion of income available to put towards improving the arrears situation.

So without having to run the risk of giving advice, lenders adopting a more holistic approach to arrears can turn the FSA’s rules to their advantage and put more borrowers back on the straight and narrow.

They can also fulfil their obligations with regard to Treating Customers Fairly.

So lenders should see the new rules, rather than being a burden, as a chance to tackle underlying unsecured debt liabilities at source and free up disposable income for the repayment of arrears.

John Fairhurst

Managing Director

Payplan

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Loan Shark Debt Campaign Update

Loan shark debt dangers highlighted in ongoing campaign

The Office of Fair Trading (OFT) has joined the ‘Stop Loan Sharks‘ campaign aimed at warning people about the risks of using loan sharks to try to solve their debt problems.

Loan sharks are actually illegal money lenders and prey on those vulnerable people struggling with debt. Unlicensed loan sharks will often offer cash loans without paperwork, charge extortionate interest rates and may use benefit payments or bank cards as security or threaten the use of violence if loan payments are missed.

According to the (OFT) there are an estimated 165,000 households in the UK that have loan shark debts, with half of these in the most deprived areas of the country.

In accordance with the campaign now fronted by the OFT and Trading Standards Illegal Money Lending Teams, loan sharks can now be reported by either calling 0300 555 2222, by sending a text with the words ‘loan shark’ and the details to 60003 or by sending an email to reportaloanshark@stoploansharks.gov.uk.

Jacqui Kennedy, Director of Regulatory Services at Birmingham City Council said:

‘It’s great to have the support of this campaign in our continued fight against loan sharks. It’s vital that we get our message out to vulnerable people that loan sharks are never a good option. It may seem like easy cash at first but very quickly people can become trapped in a spiral of debt’.

Nationally, the ‘Stop Loan Sharks‘ project has so far helped more than 11,500 people, written off more than £31 million of illegal debt, secured more than 60 years in prison sentences including an indefinite sentence for public protection, and seized £1million in cash.

For more information about how to report a loan shark watch the ‘Stop Loan Sharks’ campaign film on YouTube.

IMPORTANT NOTICE
If you’re receiving violent threats made by loan sharks because of missed payments, you should contact the Police immediately. If you’re struggling to manage your debts, contact Payplan today for free, confidential debt advice.

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Inflation Increase in April 2010

As Payplan previously reported on the predictions made about inflation, the latest updates are as follows:

The Consumer Price Index (CPI) annual inflation was up from 3.4% in March to 3.7% in April, well above a Government target of 2% and the highest rate since November 2008.

The largest upward pressures to the change in the CPI annual rate between March and April, according to the Office for National Statistics (ONS), came from:

  • clothing and footwear - prices rose by 2.2% between March and April this year but rose by only 0.2% in 2009
  • food and non-alcoholic beverages, rose by 2.6%, according to the ONS
  • higher duty on alcohol and cigarettes introduced in April’s Budget also added to inflation for that month, as prices rose by 2.1% between March and April this year but were unchanged a year ago.

In the year to April, the Retail Prices Index (RPI) annual inflation was 5.3%, up from 4.4% in March, the highest since July 1991. The main factors affecting the CPI also affected the RPI.

However, Governor of the Bank of England Mervyn King said in a statement earlier this month, that he expected the current rise in inflation to slow below the 2% target by the end of the year, noting the increase in VAT back up to 17.5% earlier this year and the rise in fuel costs as the main reason for the rapid increase.

Payplan

If you are struggling to manage your monthly bills, contact Payplan today for free, confidential debt advice or simply call 0800 280 2816.

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