News in brief: asset finance, taxes, digital economy

News in brief
News in brief

Asset finance industry continues to grow

New figures from the Finance and Leasing Association (FLA) show that asset finance new business (primarily leasing and hire purchase) grew by 3% in October, the twenty-fifth consecutive month of growth.

IT equipment finance grew by 2% in October compared with the same month last year, while finance for commercial vehicles and plant and machinery both grew by 1% over the same period.

The asset finance industry financed 32.4% of all UK investment in machinery, equipment and purchased software in the twelve months to September 2015 – its highest level for more than six years.

Commenting on the figures, FLA head of research and chief economist Geraldine Kilkelly said: “October saw continued growth across most of the main asset finance sectors, although the slowdown in emerging markets in recent months and falls in commodity prices have hit demand for construction and agricultural equipment finance. The FLA’s Q4 2015 Asset Finance Confidence Survey shows that the industry expects new business to grow by up to 10% in 2016.”

SME tax disputes accepted for ADR rises by 70%

New figures, obtained by tax consulting firm RSM via a freedom of information request, show that the number of personal and small business tax disputes accepted for Alternative Dispute Resolution (ADR) has risen by more than 70% in the last year.

The statistics also show that the taxman is increasingly likely to try and resolve tax disputes through ADR mechanisms rather than expensive civil litigation. In 2013-14, 66% of applications were accepted for ADR, but in 2014-15 this figure had risen to 82 per cent.

RSM’s head of tax investigations Mike Down said: “These statistics show that HMRC is now increasingly likely to accept applications for ADR as a means of resolving contentious tax issues.

“Some disputes can result in a complete breakdown of trust between HMRC and taxpayers so having the option of a neutral mediator getting involved can often break the deadlock. The facilitators will invariably be HMRC personnel, so while they cannot accurately be described as being truly independent, in our experience they have always been scrupulously fair to both parties.

“Clearly, this is a cost-effective way for HMRC to conclude tax disputes, but there are potentially significant benefits for taxpayers who may be able to settle their affairs more quickly and without being drawn into expensive and lengthy litigation.”

Businesses are failing to keep pace with digitising economy

A new global study from Arthur D Little (ADL) reveals that the majority of corporations still underestimate the risks of failing to keep pace with a rapidly digitising economy and feel ill-equipped to make a holistic digital transformation.

Companies struggle to fully embrace digitalisation because of lagging adoption in their business models and, from an HR perspective, new data-based personalised services and overall digital capabilities. Only 17% of surveyed companies have comprehensive roadmaps in place to master the digital transformation

“As customers across the world embrace the new marketplace of shared ownership, on-demand services, and personalisation, no industry is immune to the growing need for digital transformation,” said initiator of the study and leader of ADL’s TIME Practice Dr Michael Opitz. “We fear that today too few CEOs recognise the urgent need not just to invest in new technology, but fully realign every aspect of their businesses to the new digitally driven marketplace.”