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FYI - In the News

The end of rip-off charges? While companies and service providers can no-longer charge customers for using a credit or debit card there are a range of unintended consequences that highlights the tendency towards 'sound-bite-grabbing' politics. Yes, so-called rip-off charges may now be outlawed, but one immediate effect of the new law is that it is no longer possible to pay your tax bill online direct to HMRC. Many retailers, especially the large ones, will of course simply find other ways of passing the costs on. House prices to flat-line While house price growth stayed positive last year despite the negative mood music the harbingers of doom experts believe that won't be repeated in 2018, as the twin spectres of Brexit and rising interest rates put the brakes on the property market. Most are warning homeowners to prepare for an underwhelming and subdued 2018, with a number of leading commentators predicting UK house prices will either stay flat or perhaps rise by 1% or so. The FT points out, that if growth stays below inflation for the next three years, house prices will revert to their historical averages, which might not be a terrible thing. Over 65s drive UK spending U.K. household spending, excluding mortgage payments, rose to £554.20 pounds per week in 2017, climbing back to pre-crisis levels of more than a decade ago for the first time, according to a report by the Office for National Statistics - that's an increase from £533 the previous year. Transport accounted for the biggest proportion of expenditure at £79 per week, more than housing and recreation. Both transport and recreation rose by more than £5 a week each. Of note, 65-74 year olds spent more than twice as much as under 30's on culture and recreation - a fifth of their disposable income. Tax rise for under 50s on the horizon? The Government Actuary's Department GAD said the state pension fund, which is funded by national insurance contributions is under considerable strain due to Britain’s ageing population. The GAD believes that "class 1" contributions from employers and workers need to rise from the current 22% to 27% by 2035. This would result in national insurance contributions from these groups raising from £90billion to about £113billion. An antidote to Blue Monday As Christmas becomes a distant memory, and we peak at the festive bills and the festive bulge, some bright sparks have dubbed the 15th January 'Blue Monday' where a series of forces coalesce to make us all feel incredibly sad. The FT provides an antidote in the form of some useful money saving tips to combat the woe if you're looking at a holiday, namely;

  • Clearing your cookies that holidays and travel companies use to raise the price

  • Never buy an excess waiver from a car hire company

  • Make sure you book your travel insurance to start the day you buy your holiday.

Sterling in 2018 The Euro is unlikely to post large gains versus the British Pound in 2018 according to experts, as they set out their forecasts for coming months. There is certainly a more constructive tone to forecasts for the Pound at the start of 2018, when compared to the same time last year. Its revival, currency analysts say, is reflecting growing optimism in the markets about a "soft" Brexit. The Times point out though, that Sterling remains vulnerable in this environment, and that the rollercoaster has a long way to go. Bitcoin bites would-be property owners Many younger investors who have enjoyed a whopping windfall on Bitcoin have been trying to channel their new-found fortune into UK property, having converted their profits to Sterling. However, mortgage lender and brokers have been turning would-be investors away, for fear of breaching ant-money laundering regulations. The trouble has come from satisfying the challenge of tracing the source of the money. This is, of course, is where the advantage of cryptocurrency not being regulated by a central bank becomes rather more a hindrance. Paradise lost The Paradise Papers raised more questions than answers, but one certainty, as reported by the Guardian, is the high volume of tax-avoidance schemes, particularly those creating offshore accounts in tax-free jurisdictions, being offered to the wealthy like never before. Tax avoidance has never been more commoditised, and commentators have highlighted some pre-Panama Paradise Papers emboldened intermediaries, offering schemes like packaged holidays.

The above content should not be construed as advice – please contact us if you wish to discuss how your finances might be affected by any of the above.

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