There are various
exams on BAT that have an expiry of the end of the calendar year,
so time to get your skates on and complete the exams that are
relevant to you - BEFORE end of 2020.
And, of course,
mandatory exams are just what they say they are…so please take them
before trying to finish them all on a drink induced Hogmanay
One of the mandatory exams is TCF, and to help you get over the
line IFAC produced a six minute video this week.
The IFAC TCF exam needs to be completed by the year end….please log
into BAT and navigate to TCF mandatory test.
CASHFLOW FORECAST TOOL LAUNCHED BY IFAC
See in BAT for a
cashflow forecast tool that has now been launched.
Now we know this is
accurate, and we know this works.
The forecast has been tested and is relatively straightforward to
use and simple.
There is more to do. This is a soft-launch. One test user
asked "are the results stochastic or
deterministic?" Well, to be honest, we
hadn’t considered that one, (it's the second) but press on – this
is a soft launch, and we’ll change what you want changed, we work
for you, and like to bring you tools that help you to make money
and save money.
see direct link here
We have a lot coming
your way on BAT – next stop is to create workflow tasks, and we
expect that to be installed by Christmas. Trust me, we are working
hard to produce a system you want to add value to your practice. firstname.lastname@example.org
KEN BAKSH ON UK INCOME STOCKS
It is time to revisit UK Income
funds which have been so battered this year to date. Apart from the
obvious factors explaining the UK equity underperformance...bad
politics, bad Covid ,bad Brexit and bad economy, income funds have
suffered disproportionately. To close business 28th October UK
Equity Income Unit Trusts were showing a decline of 22.6%,compared
with -20.1% (all companies) and -16.5% (Equity and Bond
Year to date pharmaceuticals, food retailers, tobacco, mining
stocks have had a favourable dividend experience, even if not
desired price performance!
In recent weeks a return to value, defensive stocks has led to
sector outperformance by utilities,telcos etc - Royal Dutch, BT and
Lloyds Bank all produced better than expected statements and
actions/hints suggesting return of dividend payments, just
yesterday. These stocks form the basis of many large cap
income funds, whether investment trust or OEIC.
Peel Hunt have recently produced a note showing a number of FTSE
100 stocks which are "highly likely" to be paying income
worth between 4% and 7% of the current share price by June
2021...many in the finance sector.
I note that at the current time the yields on IUKD (UK higher
yielding equities),SHYU (US junk bonds) and SEML (Emerging Market
Local Currency ) are ALL yielding the same - 5.2%....something is
wrong surely with at least one of these valuations.
LIBOR FAILS TO DIE
and agencies across the world expressed horror at the manipulation
of LIBOR. The perpetrators, or rather just four of them, were
tried, found guilty and punished, after a £60m investigation.
Today we await a new
replacement for LIBOR. And we are still waiting. And we are
now entering the eighth long winter since. Countless
alternative benchmark providers have sprung into action over the
last few years, such as:
- the US Federal Reserve System’s Secured Overnight
Financing Rate, or SOFR
- the Bank of England’s Sterling Overnight Index
Average, or SONIA
- the Swiss Average Rate Overnight, or SARON
- the Tokyo Overnight Average Rate, or TONAR,
- the newly introduced European Central Bank’s Euro
Short-Term Rate, or €STR
however, none of them
have caught on, and banks are still writing contracts based on
LIBOR. LIBOR lives on. Risk models, compliance
systems and operational flows are set to LIBOR, and it seems too
much to replace it.
ROYCE SCHEME DB DILEMMA
The FCA has issued a data request to certain
advisers who have advised on transfers from the Rolls-Royce DB
pension scheme. The FCA, the Money and Pensions Service (MaPS) and
the Pensions Regulator have been engaging with Rolls-Royce and
trustees of the scheme. All these bodies believe transferring
out of a DB pension scheme is unlikely to be in consumers’ best
The FCA invites scheme members looking for impartial guidance to
contact the Pensions Advisory Service (part of MaPS), on 0800 011
3797 before taking any action.
Comment by Charlie: Yet another scandal is brewing, partly
exasperated by the pace of enforcement at the FCA. Since
nothing by hot air has come out of the steel works in south wales –
excuse the pun – maybe some advisers have let their guard down…well
just wait. The FCA work at a snails pace, and the fall out from
Steel will be a big one for a small number of people, but in the
meantime, others look like joining the queue for a kicking.
Based on the published Annual CPI to September 2020
of 0.5% and legislation, the Lifetime Allowance for 2021/22 would
be calculated as £1,078,500.
However, last year when announced the Lifetime Allowance was
actually increased using the CPI indices to three decimal places, which
would give a Lifetime Allowance for 2021/22 of
£1,078,900. Previously the Lifetime allowance
rounded up to nearest £5,000, so meantime we wait for confirmation
in legislation to be sure.
UPDATE ON TOP SLICING RELIEF FOR BONDS (SINGLE
PREMIUM LIFE ASSURANCE)
HMRC is working to ensure all affected customers
from 2018-19 onwards receive the Top Slicing Relief that they are
- Finance Act 2020
provides clarification on beneficial ordering of the personal
allowance within the TSR calculation.
- It also confirms
that allowances must be set, as far as possible, against other
income in preference to the gain.
- This ensures that
the personal allowance cannot be used twice in the tax year,
which would lead to too much relief being claimed.
- This is not a
change of policy.
- The relief
calculation has always applied this method.
- There is no change
to how they calculate any other relief, allowance or rate such
as the savings nil rates.
estimate that 2,000 will enjoy these changes.
VIDEO WITNESSING OF WILLS
Government proposals to amend the Wills Act 1837 to
allow for virtual witnesses by video link came into effect
(retrospectively) from 28 September 2020.
Between 31 January 2020 and on or before 31 January 2022, wills can
have a “presence” including by videoconference or other visual
This does not authorise remote signing on behalf of a testator nor
the use of electronic signatures nor counterpart
documents. Remote signing by a testator is not allowed.
The Ministry of Justice says that remote witnessing should be used
only in an emergency, only when conventional witnessing is
impossible, and that extreme caution is required.
From 2 November 2020, you will have to use the online probate
service for almost all applications.
applying for a grant through a solicitor or probate practitioner,
other than a grant listed in the Third Schedule, must apply using
the online portal, unless invited to apply at a registry by that
The Third schedule is a list of fairly unusual events, including
where no will was made.
November is apparently “Make
a Will month” – which a bit like Halloween and other
events makes it more like a sales opportunity! Time to raise
this important subject with your clients.