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MoD received £211bn worth of suspicious invoices in three years amid fraud crackdown
Business

MoD received £211bn worth of suspicious invoices in three years amid fraud crackdown

by July 25, 2025

The Ministry of Defence has flagged and rejected more than £211 billion in suspicious invoices over the past three years, as it ramps up efforts to combat financial fraud within one of the government’s most complex and high-value departments.

According to official figures obtained via a Freedom of Information (FOI) request and analysed by the Parliament Street think tank, the MoD rejected a total of 8,918 invoices, citing concerns over invalid pricing, tax anomalies, missing supplier data, duplicate entries, and inactive purchase orders. The total value of the rejected invoices reached £211,649,900,000.

While 5,063 of the flagged invoices were later corrected and resubmitted, 3,855 were permanently rejected, highlighting the scale of attempted or accidental misbilling within the ministry’s procurement system.

The revelations follow a string of high-profile fraud cases that have rocked the MoD’s internal accounting and financial oversight systems.

In April, former corporal Aaron Stelmach-Purdie was sentenced to prison for orchestrating a £911,677 fraud by exploiting the MoD’s staff expenses platform. The court heard that he manipulated allowance claims, pocketing over £550,000 for himself.

Just two months later, army soldier Andrew Oakes was convicted of stealing more than £300,000, using his position as a financial administrator to forge cheque stubs and redirect funds to personal accounts. The stolen money was used to purchase multiple high-end vehicles, including three Teslas, a Mini Cooper, and a Nissan Qashqai.

These cases have prompted calls for tighter financial controls and modernisation of verification systems, with growing consensus around the role of AI and machine learning in fraud prevention.

Jason Kurtz, CEO of e-invoicing platform Basware, said the scale of rejected invoices highlights the vulnerability of public sector finance systems.

“When fraud is suspected, we often see large fluctuations in billing as criminals exploit stolen or cloned credentials,” Kurtz explained. “Blocking payments is only half the battle — the resource burden of investigating fake or incomplete invoices is enormous.”

He called for greater deployment of AI-powered verification tools that can vet invoices before they enter the payment system, reducing the burden on overstretched finance teams.

Dr Janet Bastiman, chief data scientist at Napier AI, added that invoice fraud is a common tactic used by organised crime to siphon funds from high-volume government departments.

“Malicious actors frequently use fake paperwork and rogue bank accounts to fuel money laundering and illicit operations,” Bastiman said. “Government departments managing thousands of supplier payments a day are obvious targets. AI-powered anomaly detection offers a proactive way to catch suspicious transactions before the damage is done.”

With the MoD facing increasing scrutiny over its financial management, defence officials are under pressure to strengthen invoice auditing systems and modernise their approach to procurement oversight.

The sheer volume and value of flagged invoices suggest that existing safeguards — while catching many of the most egregious examples — are not fully equipped to prevent fraud at scale.

The findings come at a time when public trust in defence spending remains fragile, and fiscal discipline is under intense political focus. As the MoD contends with rising operational costs and evolving global threats, its financial resilience may increasingly depend on its digital defences as much as its physical ones.

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MoD received £211bn worth of suspicious invoices in three years amid fraud crackdown

July 25, 2025
This is a text of gratitude. A good thing happened in the financial market
Business

This is a text of gratitude. A good thing happened in the financial market

by July 25, 2025

Recently, Investment Capital Ukraine (ICU) agreed to release the hostages it had been holding for months. It offered bondholders to exchange the frozen unrestructured Loan Participation Notes (LPNs). To replace them with the same bonds, but already restructured ones. They belong to ICU in other issues.

In my opinion, this is a very good and ethical thing for the company to do. It can really correct the injustice that has been going on for quite some time. If you are not up to date, let me briefly remind you.

Even before the full-scale invasion, Alfa-Bank’s VIP depositors were offered a special investment product – Loan Participation Notes (LPN) issued by the Dutch company EMIS Finance B.V. These were securities with higher yields in foreign currency. In order to guarantee the safety of the money from Ukrainian legislation risks, the LPNs were issued by the Dutch company EMIS Finance B.V. and are in some way separated from the bank.

Alfa-Bank returned the funds raised to Ukraine and used them to issue new loans, and then shared the profits with its VIP clients. The deal was mutually beneficial, and Alfa Club became the most powerful VIP banking system in Ukraine. But with the outbreak of a full-scale war, the bank was nationalised, and the money of Ukrainian depositors was “suspended”.

The former owners of Alfa agreed to return the money, but asked to wait. They proposed a restructuring scheme for multiple tranches of LPNs. Most of the LPN issues have already been restructured. The scheme was used by influential Ukrainian families and companies, including (it turns out) ICU. Now they just have to wait for their money.

But there are just a few tranches left, the majority stake in which were bought up by the ICU group. The company began to play its own game, apparently demanding money from EMIS Finance B.V. not later, but immediately. They refused, and the situation “hung”. The LPN holders, who had a minority of votes, were held hostage (I will refer to them in this way below) and therefore could not influence the negotiations. After unsuccessful requests for restructuring (Investment Capital Ukraine did not agree), they began to use leverage. In particular, they could have influenced the imposition of sanctions against Petro Poroshenko, who is considered to be affiliated with ICU. I wrote about this here.

https://www.facebook.com/anserua/posts/pfbid0bVLxgLRodDJTmGucaNM4JLWwjfbay8cHq3CXosdvwFSkzyPosMTX6PjY47YHZkFFl

Time passed, but the situation did not change. On the contrary, ICU has recently gone on the offensive. The company proposed to change the trustee and paying agent of the blocked LPN tranches from BNY Mellon to Global Loan Agency Services Ltd (GLAS). Why? BNY Mellon is a world-renowned financial group with an impeccable reputation. Its business is simply to serve the process. GLAS, however, specialises in distressed and disputed assets. It often acts in the interests of the customer, not the market. It looks like ICU is going to get its money’s worth with the help of GLAS.

Of course, this upset the “hostages” even more, because for them, replacing the trustee would mean the failure of the restructuring, and the LPN debts would finally “hang”. But they had no chance to change this scenario, because the ICU holds the majority of votes.

For some time, it seemed to me that the main purpose of replacing the trustee was to force the “hostages” to sell their LPNs to the group at a large discount. In fact, ICU has professed this philosophy before: buy cheaply while everyone believes in the crisis and then sell at a premium.

Nevertheless, a pleasant miracle happened. Mr Paseniuk and Mr Stetsenko offered the “hostages” to replace the LPNs with the same securities, but already restructured (from other tranches). This is a gentlemanly act.

I don’t know who to thank for this. Perhaps Petro Poroshenko, who could have conveyed a simple message to the company’s co-owners Makar Paseniuk and Kostiantyn Stetsenko: the most dangerous opponent is the one who has nothing to lose. If we believe that it was the “hostages” who influenced the imposition of sanctions against Poroshenko, we can imagine what they would have done next. For ICU, this pressure could have been fatal and resulted in personal sanctions against the company and its owners. If this is the case, I think I would be very right to convey the gratitude of several families to you, Mr President.

Of course, another motivation might have worked. Messrs Paseniuk and Stetsenko could have soberly judged that it was not worth going to war with outraged “hostages” in the rear. After all, sanctions have already happened in Petro Poroshenko’s life, but they may yet appear in theirs. As for the possible reasons, it doesn’t take too long to find them. The professional biography of ICU’s leaders is closely intertwined with Russia’s VTB.

https://ukranews.com/ua/news/1094661-sergij-lyamets-personalni-sanktsiyi-proty-icu-chomu-yevropa-ta-ukrayina-mozhut-uhvalyty-take

The main thing in sanctions is not the presence of facts, but the decision to let them develop. This is exactly what the danger was for ICU. In the event of sanctions, one can kiss goodbye to one’s reputation and financial career in Ukraine, the UK, and Europe. And I’m not even talking about the monetary losses. I’m sure that current ICU clients would be very much against such a scenario. If so, the company’s decision is a manifestation of common sense.

In any case, a gentlemanly act is a gentlemanly act. It is a credit to Messrs Paseniuk and Stetsenko. It releases ICU from confrontation with the “hostages”.

Albeit, as my sources ironically point out, one part of ICU’s problems has been solved, but the other is just beginning. In their opinion, the company is at risk.

Here’s the thing. ICU is moving to an aggressive stage of pulling out its money. To do this, they need GLAS.

I may be wrong, but ICU’s actions are unlikely to threaten EMIS Finance B.V. This structure is simply a so-called SPV – a transit company that gives money only after it receives it. Where is the real money? Maybe in Russia? No.

The money will be paid by…

three…

two…

one…

Ukraine.

That’s right. Ukraine.

My interlocutors told me a dark secret. The only chance to return the money to the holders is to negotiate with Ukraine on compensation for the nationalised assets. In their opinion, this will require waiting for the end of the war. Although I cannot imagine how Ukraine will agree to this.

If you want the money faster, sue Ukraine. Therefore, according to my interlocutors, ICU will sue Ukraine. After all, it was Ukraine that nationalised Alfa, it was Ukraine that made it impossible to get the LPN money back.

To a large extent, I believe in such a scenario. The fact is that the ICU is serviced by Cleary Gottlieb, an international law firm. It was this company that was the architect of the warrant deal in Jaresko’s time. Let me remind you that the holders of these securities receive hundreds of millions of dollars if Ukraine’s GDP grows by more than 3% over the year. If GDP growth is between 3% and 4%, Ukraine pays 15% of the amount exceeding 3%. If GDP growth exceeds 4%, it pays 40% of the total amount of growth over 4%.

https://www.slovoidilo.ua/2025/04/29/infografika/ekonomika/vvp-varanty-ukrayiny-ce-ta-yaki-umovy-vyplat

It is very likely that these securities were once made possible thanks to Poroshenko’s political support, and for many years they have been alive thanks to old connections. So, even today, Cleary Gottlieb services warrant holders. It is quite possible that ICU or its clients are among the holders of these securities, but I have no facts about this.

But let me remind you that we still don’t know who the warrant holders are. International lawyers protect the anonymous owners. Ukrainian society is outraged by their actions, but this outrage is very abstract. No one knows the stakeholder.

In the case of LPNs, it’s a completely different story. The holder of the bonds is either ICU or a client that the company cannot name. This is a completely different configuration. A financial company with Ukrainian roots and revenues in Ukraine… will sue Ukraine.

It’s not pretty, no matter how you look at it. International courts may decide that Ukraine owes money. But what will be the reaction of society? It is insidious and inhumane to extract money from a country in the midst of a war to make super-profits. Especially for a Ukrainian company.

I’m not too sure about their colleagues either. If Cleary Gottlieb conducts this project, I will speculate further. But is Global Loan Agency Services Ltd (GLAS) ready for reputational losses? Does the company know from whom they will have to collect the money? This is very intriguing.

Of course, some other scenario is possible. But something tells me that this is exactly what it looks like: ICU v. Ukraine.

So far, this has not happened. We’ll see how it goes. Let me remind you that I still have not received any comments from ICU.

In conclusion, I would like to compliment the company once again. Messrs Paseniuk and Stetsenko acted like gentlemen. It is possible that this happened under the influence of Petro Poroshenko, for which he will receive a compliment of his own.

To be continued. Or not.

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This is a text of gratitude. A good thing happened in the financial market

July 25, 2025
Fields of fortune: Why farmland remains a tax-efficient safe haven — for now
Business

Fields of fortune: Why farmland remains a tax-efficient safe haven — for now

by July 25, 2025

For centuries, land ownership has been a cornerstone of British wealth.

Today, in an era of inflation, political scrutiny, and shifting tax policy, UK farmland is once again in vogue—not merely as a legacy asset but as a strategic, tax-efficient investment for high-net-worth individuals (HNWIs) and business owners seeking long-term capital protection.

Yet the rules underpinning this pastoral advantage are under threat. As Chancellor Rachel Reeves advances proposals to reform Agricultural Property Relief (APR), what has long been a discreet haven for generational wealth may soon face profound change.

The enduring appeal of land

Farmland continues to offer a powerful value proposition: scarcity, price resilience, and unparalleled tax reliefs. According to the Royal Institution of Chartered Surveyors (RICS), UK farmland values rose 7.3% in 2024, buoyed by investor demand, food security concerns, and the monetisation of natural capital through carbon credits and biodiversity offsets.

“Farmland offers both legacy and leverage,” says Henry Pemberton, a land advisor at Savills. “From a tax and wealth planning perspective, it has few rivals.”

The tax architecture: APR, BPR and CGT deferral

At the heart of farmland’s appeal are Agricultural Property Relief (APR) and Business Property Relief (BPR) — powerful tools that offer 100% relief from inheritance tax when structured correctly.

APR applies to land actively farmed or let out for agricultural use, provided it’s held for two years (or seven if let).
BPR can extend that protection to mixed-use or diversified estates that generate trading income, such as from holiday lets or renewable energy.
Capital Gains Tax (CGT) can often be deferred through hold-over or rollover relief, further increasing the asset’s efficiency in estate planning.

Sarah Allardyce, a tech entrepreneur, purchased 88 acres in Kent following a business exit in 2020. Combining regenerative agriculture with solar power and biodiversity credits, she structured her land investment to optimise reliefs.

Her strategy included:

APR on her farmland after two years of direct farming.
BPR on a consultancy operated from the property.
Income from a wildflower offset scheme leased to a local conservation group.

“I didn’t buy land for the subsidies,” she said. “But the tax reliefs certainly sweetened the model.”

The storm gathers: Reform proposals on the table

In her July 2025 Budget, Chancellor Rachel Reeves launched a consultation on overhauling APR — a move the Treasury says could raise £1.2 billion in additional IHT by 2030. Proposed changes include:

Restricting APR eligibility to working farmers, excluding passive investors.
Reassessing relief on non-agricultural activities, including renewable energy, glamping, and rewilding.
Limiting APR for land held in corporate or offshore structures.

Critics argue these reforms would penalise environmental stewardship, deter new entrants, and destabilise family-owned estates that rely on APR for intergenerational continuity.

Enter, the Jeremy Clarkson effect

Among the most vocal opponents is Jeremy Clarkson, whose Amazon Prime series Clarkson’s Farm has turned him into an unlikely agricultural advocate. In a recent episode, Clarkson railed against the idea that his farm might be deemed “inactive” under new rules.

“So let me get this straight,” he said. “I pay for the tractor, the barn roof, the seed, the diesel, I risk everything on the weather… and then the Chancellor tells me the land isn’t ‘active’ enough to qualify for relief? Madness.”

Clarkson has joined forces with the National Farmers’ Union and a coalition of rural MPs to resist the proposed changes, warning they will erode rural resilience and discourage sustainable innovation.

Case study: Family planning in the countryside

The Hunter-Bennett family, former logistics business owners, invested £6.5 million in a 400-acre Suffolk estate in 2022. With two adult children managing the estate full time, they secured full APR and BPR relief through a UK LLP and trust structure.

Now, amid the policy uncertainty, they are reviewing holiday let income streams and rewilding credits to ensure future eligibility.

“If these reforms go through as written, we may need to unwind parts of the trust or explore restructuring,” said trustee Mark Bennett.

Outlook: Tax shelter, but for how long?

Despite the turbulence, farmland continues to offer unmatched advantages: scarcity, cultural capital, diversification, and long-term tax sheltering. But the rules are no longer guaranteed. Savills has reported a 30% increase in farmland acquisitions via trusts and family investment companies in Q2 2025, as advisors rush to secure current reliefs before any legislative changes are enacted.

“What was once an evergreen shelter is now under audit,” says Pemberton.

Conclusion: Invest in land — but stay alert

Farmland still offers a uniquely British blend of prestige, protection, and performance. But the future of tax efficiency in the sector is under scrutiny, and the window to act may be closing.

For HNWIs and business owners seeking stability, the message is clear: invest in land — but do so with urgency, foresight, and a team that understands both the soil and the statute book.

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Fields of fortune: Why farmland remains a tax-efficient safe haven — for now

July 25, 2025
EU fails to reduce 50% steel tariff in draft US trade deal as industry warns of ‘catastrophic’ impact
Business

EU fails to reduce 50% steel tariff in draft US trade deal as industry warns of ‘catastrophic’ impact

by July 25, 2025

The European Union has failed to secure any reduction in the punitive 50 per cent US steel tariff in the latest outline trade deal with Washington, leaving the bloc’s exporters facing one of the harshest trade penalties imposed by President Donald Trump’s administration.

Despite weeks of high-level negotiations and mounting pressure from European steelmakers, diplomats confirmed this week that the provisional agreement includes a 15 per cent baseline tariff on most EU goods—but crucially, steel remains excluded from the reduction.

“It includes a 15% baseline tariff on a range of goods, with notable exceptions such as steel, which remains at 50%,” a Brussels diplomat said.

The news has dealt a blow to the European steel industry, already under strain from high energy costs and rising imports of cheap Chinese steel. The sector had hoped for parity with Britain, which secured a 25 per cent steel tariff, now due to fall to zero under the bilateral deal agreed by Keir Starmer in May.

By contrast, the EU now faces a steel tariff twice the UK’s rate, prompting renewed warnings from Eurofer, the EU’s steel industry body, that the measures could be “catastrophic” for the sector.

Sources suggest that Brussels is still pushing for a quota-based compromise, whereby the 50% tariff would only apply to EU steel exports above a certain volume. However, there is no confirmation that this idea has gained traction with the US side.

President Trump reiterated his hardline position at an AI summit in Washington on Thursday, stating that countries without a signed agreement could expect tariffs “anywhere between 15% and 50%”.

Although EU diplomats stress that the agreement remains a draft and that tariff exemptions and adjustments are still under discussion, the current outline points to a deal in which the EU accepts steeper trade penalties than Britain in order to secure broader access to the US market.

The EU’s urgency to conclude a deal with the US comes amid escalating tensions with China, where a widening trade imbalance and restrictions on rare earth exports have placed additional pressure on European manufacturers.

Speaking at a trade summit in Beijing, European Commission President Ursula von der Leyen warned that the EU might find it “very difficult to maintain its current level of openness” with China unless it reduced its massive trade surplus.

“These numbers speak to the scale of our relationship, but they also expose a growing imbalance,” von der Leyen said, blaming Chinese state subsidies and market access barriers for the current deficit.

Amid the rare earth shortages, European carmakers have warned of potential production stoppages. German industry group VDA said electronic systems such as automated windows and boots were being affected by a lack of key components.

Von der Leyen said a “practical solution” had been reached at the summit, allowing car firms to request direct intervention to trace and resolve delays in rare earth shipments.

As pressure grows to reach a deal with Washington, Germany’s Chancellor Friedrich Merz is said to remain eager to secure a trade pact that would restore stability to investors and automakers, even at the cost of steep tariffs on steel.

Merz, who is believed to have a direct line to President Trump, is expected to use an upcoming visit to Scotland—where Trump owns two golf courses—as a potential opportunity to make a personal appeal.

“As we lose our major export market, the European market is being flooded by the steel the US is no longer absorbing,” Eurofer warned in a statement. “This is not sustainable.”

The European Central Bank, meanwhile, left interest rates unchanged on Thursday, as it monitors whether the fallout from US tariffs will impact eurozone inflation and industrial output.

Despite the mounting concerns, EU officials privately admit that a deal with Washington—however painful—may be the only way to avoid a wider trade war. With the US election cycle heating up, and Trump doubling down on his “America First” agenda, European leaders appear willing to accept painful compromises in exchange for broader market access and investor reassurance.

But with steel singled out for the harshest treatment, Brussels now faces political backlash from an industry that feels sidelined and exposed — and a brewing dilemma about whether trade peace is worth the price of sectoral sacrifice.

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EU fails to reduce 50% steel tariff in draft US trade deal as industry warns of ‘catastrophic’ impact

July 25, 2025
LVMH suffers steep drop in fashion sales as wealthy consumers tighten belts
Business

LVMH suffers steep drop in fashion sales as wealthy consumers tighten belts

by July 25, 2025

Luxury powerhouse LVMH has reported a sharp fall in fashion and leather goods sales, as affluent shoppers in the United States and China cut back amid economic uncertainty, trade tensions, and cautious consumer sentiment.

The division behind iconic labels such as Louis Vuitton, Dior, and Givenchy saw organic sales drop 9 per cent in the second quarter to €9 billion, deepening from a 5 per cent decline in the previous quarter. The slump marked the steepest contraction among the group’s five business segments and raises concerns for the broader luxury sector, which has relied heavily on discretionary spending from high-income consumers.

Shares in LVMH fell 2 per cent to €470.25, extending a broader slide that has seen the stock fall 28 per cent over the past year.

For the first half of 2025, fashion and leather goods sales were down 7 per cent on an organic basis to €20.7 billion, while recurring operating profit in the segment declined 18 per cent to €6.6 billion. LVMH blamed tough comparisons with the same period last year, which had been buoyed by a rebound in global tourism—particularly in Japan.

Group-wide, second-quarter revenue fell 4 per cent organically to €19.5 billion, while first-half sales dropped 3 per cent to €39.8 billion. Operating income before non-recurring items came in at €9 billion, down from €10.65 billion a year earlier, broadly in line with analyst expectations.

The decline was not limited to fashion. LVMH’s wines and spirits division, home to Moët & Chandon and Hennessy, also saw revenue and profits fall, citing weaker demand in the US and China and a sluggish market for cognac. Organic revenue in the unit fell 4 per cent in Q2, bringing the first-half decline to 7 per cent.

There was a modest improvement in champagne sales, but it was not enough to offset overall weakness. Meanwhile, jewellery sales were flat, with LVMH’s portfolio of brands including Bulgari and Tiffany & Co. failing to post growth amid a cautious consumer climate.

Trade concerns loom, but pricing power remains

Speaking on the results, Chief Financial Officer Cécile Cabanis said the macroeconomic environment remained “full of uncertainty”, but expressed “cautious optimism” for the rest of the year. She pointed to potential progress in trade talks between the EU and the US, with President Trump recently softening rhetoric on a proposed 15 per cent general tariff on EU imports.

Cabanis suggested such a move could ultimately benefit sentiment among LVMH’s customer base.

“It would be an overall good outcome for the general mood of our clients,” she said.

While tariffs remain a risk, Cabanis noted that many LVMH brands still retain pricing power, allowing the group to adjust prices and protect margins if needed. To mitigate future trade exposure, LVMH also announced plans to open a new factory in Texas by 2027, further deepening its manufacturing footprint in the US.

In light of the challenging backdrop, LVMH is reassessing its portfolio, with Cabanis confirming the group will not retain any brands that fail to meet profitability thresholds. She cited the recent divestments of stakes in Off-White and Stella McCartney as part of a broader strategic repositioning.

LVMH, led by billionaire Bernard Arnault, owns 75 luxury brands and remains the world’s most valuable luxury goods group with a market capitalisation of €233 billion. However, 2025 has proven difficult for the sector as a whole, with Chinese consumer confidence hit by a property downturn and the US luxury market showing signs of fatigue.

While rivals such as Richemont have managed to offset weakness in watches and fashion with growth in jewellery, LVMH’s diversified model has been unable to escape the broader slowdown.

Still, Cabanis expressed confidence in the group’s long-term outlook, stating:

“We remain agile, committed to innovation, and focused on markets where brand equity and heritage still carry weight. There will be turbulence, but we are well-positioned for the recovery.”

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LVMH suffers steep drop in fashion sales as wealthy consumers tighten belts

July 25, 2025
UK firms cutting staff at fastest pace since February as economic pressures mount
Business

UK firms cutting staff at fastest pace since February as economic pressures mount

by July 25, 2025

UK businesses are reducing staff numbers at the fastest rate since February, according to new data, as higher payroll taxes and uncertainty over US tariffs put increasing pressure on company costs and consumer demand.

The flash S&P Global purchasing managers’ index (PMI) for July showed a further slowdown in economic momentum, with fresh orders falling, export sales contracting, and employers citing the need to cut headcounts due to rising costs and subdued demand.

“Survey respondents widely commented on the need to reduce headcounts in response to higher payroll costs and subdued customer demand,” the report noted.

The PMI, a key indicator of private sector health, fell from 52 to 51 in July, signalling continued but weakening growth. A figure above 50 suggests expansion, while anything below indicates contraction. Most of the decline came from the services sector, which fell from 52.8 to 51.2, while manufacturing output ticked up slightly to 50.

The survey findings are likely to intensify pressure on the Bank of England, which is widely expected to cut interest rates from 4.25% to 4% at its next meeting in a fortnight in an effort to lift an economy showing signs of stagnation.

Businesses reported that the combination of extra employment taxes introduced in the last budget and growing fears over President Trump’s escalating tariff regime had dampened both demand and business confidence.

According to official figures, the UK economy contracted in April and May, while unemployment rose to 4.7% in May, the highest in four years. Wage growth has now slowed for three consecutive months.

“Higher payroll taxes and a chunky rise in the national living wage back in April are exerting more significant downward pressure on staffing numbers,” said James Smith, an economist at ING. “At the same time, these policy changes appear to be keeping upward pressure on prices.”

Inflation remains stubbornly above the Bank’s 2% target, currently running at 3.4%, and is unlikely to fall significantly before 2026, according to the Bank’s own forecasts.

Smith also noted that inflation was proving particularly persistent in areas such as food and hospitality, driven in part by increased staffing costs and sector-specific wage pressure.

The PMI report also highlighted that export sales declined for the ninth consecutive month, though the rate of decline has slowed slightly. Firms blamed continued uncertainty over US tariffs, as well as heightened competition from Chinese exporters who have been shut out of the US market and are now targeting Europe more aggressively.

Despite the short-term gloom, businesses reported a relatively optimistic outlook for the next 12 months. Many expect interest rates to fall, easing borrowing costs, while a build-up of household savings could fuel a rebound in consumer spending.

“Output growth weakened to a pace indicative of the economy growing at a mere 0.1% quarterly rate, with risks tilted to the downside,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

As the UK moves into the second half of the year, the data suggests an economy struggling for momentum, with weakening domestic demand, global trade tensions, and stubborn inflation creating a complex challenge for both policymakers and businesses.

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UK firms cutting staff at fastest pace since February as economic pressures mount

July 25, 2025
River Island faces collapse unless landlords approve urgent rescue plan
Business

River Island faces collapse unless landlords approve urgent rescue plan

by July 25, 2025

River Island has warned that it could collapse by the end of the summer unless landlords approve a proposed restructuring plan that would see the closure of 33 stores, significant reductions in rent, and a need for at least £10 million in funding by September.

In documents detailing the plan—first unveiled in June—the high street fashion retailer told creditors that unless the proposals are passed, it may run out of cash by the end of August, rendering it unable to pay its debts as they fall due. A vote on the proposals and a court hearing are expected next month.

Without landlord support, River Island said it would no longer be able to continue as a going concern and would be forced to enter administration or other insolvency proceedings.

The company blamed its deteriorating finances on “a sharp rise in the cost of doing business” and the ongoing shift toward online shopping, which has left its existing store estate misaligned with customer behaviour.

The high street staple, which trades from over 200 stores, has been battling a challenging retail environment despite a brief recovery in spring trading, helped by warmer weather. The uptick followed a difficult 2024 and early 2025, as UK households cut back on fashion spending to prioritise essentials such as food and energy bills.

River Island reported a £33.2 million loss in 2023, reversing a modest £2 million profit in 2022. Sales fell 19% to £578.1 million, according to the company’s latest filings at Companies House.

The restructuring plan includes £40 million in new funding from the Lewis family’s investment vehicle, which continues to control the business. In addition, River Island’s largest lender, Blue Coast Capital, has agreed to waive interest payments temporarily and extend the maturity date on £270 million in outstanding loans from 2027 to 2028.

A spokesperson for River Island said that discussions with stakeholders had been “positive” and that the company was “confident that we will achieve approval of the plan in the next few weeks.”

In January, the retailer implemented a cost-cutting programme, including redundancies at its London head office, affecting departments such as buying and merchandising.

River Island, which began trading as Lewis’s in the 1940s and later as Chelsea Girl, is the latest in a string of high street retailers to struggle with rising costs, falling footfall, and consumer belt-tightening. The company has long been a staple of UK high streets and shopping centres, targeting younger fashion-conscious consumers.

The retailer’s plight echoes that of Poundland, which recently announced its own restructuring plan. That proposal could result in the closure of up to 150 stores, the shuttering of two distribution centres, and the end of online operations, placing 2,000 jobs at risk.

If River Island fails to secure creditor support, it risks becoming the latest casualty of a retail sector under sustained pressure. Its possible collapse would send shockwaves through Britain’s fashion industry and retail employment landscape — and further accelerate the decline of the physical high street in the post-pandemic era.

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River Island faces collapse unless landlords approve urgent rescue plan

July 25, 2025
Brushed with value: How fine art is becoming the tax-efficient investment of choice for the wealthy
Business

Brushed with value: How fine art is becoming the tax-efficient investment of choice for the wealthy

by July 24, 2025

In the polished galleries of Mayfair and the rarefied auction houses of Sotheby’s and Christie’s, a quiet financial revolution is under way.

Britain’s wealthiest investors are increasingly channelling capital into fine art — not merely for aesthetic enjoyment, but as a shrewd, tax-efficient store of value.

Once considered the preserve of collectors and connoisseurs, art is now firmly on the radar of the financial elite. In 2023, the global art market was valued at over $65 billion, with the UK accounting for a substantial 17 per cent, making it the second-largest art economy after the United States. Amid economic turbulence, soaring interest rates, and volatile equity markets, high-end art has proven resilient, particularly at the top end of the market.

According to Deloitte’s 2024 Art & Finance Report, 85 per cent of wealth managers now consider art and collectibles to be viable components of a diversified wealth portfolio.

“Art is increasingly seen as an alternative hedge,” says Laura Kingsley, a wealth advisor at a Knightsbridge family office. “It’s less correlated to equities and, crucially, offers bespoke structures that make it extremely attractive from a tax perspective.”

The tax appeal of tangible beauty

Under UK tax law, fine art can qualify as a “chattel” — a tangible, movable item — offering potential capital gains tax (CGT) relief. Artworks sold for less than £6,000 may be exempt entirely due to the chattel exemption, while those sold above this threshold benefit from marginal relief, often resulting in a lower CGT liability than property or shares. Some pieces, particularly those made from materials expected to degrade, can even be classified as “wasting assets” and are therefore exempt from CGT altogether — though HMRC may contest this.

For inheritance tax (IHT) planning, placing artworks into trusts or corporate structures can defer or mitigate tax exposure. Schemes such as the Cultural Gifts Scheme and Acceptance in Lieu allow donors or their heirs to reduce tax liabilities by offering artworks to public collections, creating both fiscal and cultural value.

“These are powerful tools,” says Fiona Holder, an art tax advisor at Withers LLP. “They allow investors to reduce tax, enhance legacy, and avoid forced sales — all in one elegant move.”

The collector-turned-strategist

One London-based fintech entrepreneur, Amanda Sloane (name changed), began acquiring post-war British art in 2016, initially out of nostalgia. But as values climbed, her strategy evolved. Her £2.5 million collection now includes works by Bridget Riley, David Hockney, and Frank Auerbach, with a portfolio valuation of £4.1 million by 2025.

Key pieces are held in a Swiss bonded warehouse to defer VAT and simplify estate planning. The collection itself is owned via an offshore discretionary trust, shielding it from IHT, and she has donated a Hockney sketch through the Cultural Gifts Scheme, reducing her income tax bill by £180,000.

“At some point, you realise the art is working harder than your index fund,” she says. “Plus, I’d rather see a Hockney every morning than log into an ISA.”

Family offices embrace structured elegance

The Yewtree Family Office, based in Surrey and backed by third-generation property wealth, began investing in contemporary art in 2019. Their £6 million collection includes pieces by Yayoi Kusama, Banksy, and Lynette Yiadom-Boakye. Structured through a UK limited company, the artworks benefit from tax-deductible storage and maintenance costs. Pieces are insured, professionally inventoried, and circulated between private residences and public loans — bolstering both social standing and long-term valuation.

A gifting strategy via the Acceptance in Lieu scheme will eventually offset the family’s future IHT bill as assets pass to the next generation.

“Art offers more than returns,” the family said. “It tells a story. It represents legacy. And in today’s fiscal environment, it also offers protection.”

Caveats of the canvas

Despite its advantages, art investing is not without risk. Liquidity is a persistent issue — even high-value pieces can take years to sell. Valuations are subjective, and without proper documentation (known as provenance), artworks can become legally unsellable. Investors must also contend with market cycles, fashion trends, and forgery risks.

“There’s no Financial Services Compensation Scheme for a fake Rothko,” warns Holder. “This is not a DIY pursuit. You need experienced advisors who understand both the art world and tax code.”

Where money meets meaning

As regulatory scrutiny tightens and traditional tax strategies come under the spotlight, fine art offers a unique blend of discretion, diversification and durability. With the right structure and support, it can deliver not just capital preservation, but cultural resonance.

In an era where spreadsheets meet brushstrokes, it seems Britain’s wealthy are increasingly choosing to hang their assets on the wall — and let them work in silence.

Read more:
Brushed with value: How fine art is becoming the tax-efficient investment of choice for the wealthy

July 24, 2025
The £100k Tax Trap: Why More Professionals Are Questioning the Value of Earning More
Business

The £100k Tax Trap: Why More Professionals Are Questioning the Value of Earning More

by July 24, 2025

A few weeks ago, I was reading an article in The Times that explored a lesser-known quirk of the UK tax system—one that’s quietly influencing the decisions of high-earning professionals across the country.

It looked at the growing number of individuals choosing to structure their income to avoid crossing the £100,000 mark. At first glance, that might sound counter intuitive.

Surely earning more is always better? But what the article revealed—and what many of us are starting to understand more clearly—is that past a certain point, the financial reward for working harder or taking on greater responsibility can begin to diminish significantly. It’s a fascinating and somewhat troubling shift, and one that resurfaced in my mind over the weekend during a discussion with a group of friends.

The conversation wasn’t necessarily about salaries or tax, but as we spoke about career growth, financial planning, and what people’s next steps were, it came up again: that moment when earning more doesn’t always feel like moving forward.

There is a specific point in the UK income tax system—at £100,000—where the rules change dramatically. Not only do you start paying 40% tax on anything earned above that threshold (as part of the higher rate band), but you also begin to lose your tax-free personal allowance entirely. For every £2 you earn over £100,000, £1 of your personal allowance is withdrawn.

By the time your income reaches £125,140, it has been completely removed. This creates an effective marginal tax rate of 60% on the income earned between £100,000 and £125,140. In other words, for every extra pound earned in that band, you’re only taking home 40 pence. I’ve realised that for many people, this is a startling realisation.

What’s perhaps even more surprising is the psychological impact this has. As business leaders and professionals, we’re often driven by a desire to push forward, to do better, to take the next step—whether that’s in the form of a promotion, a larger project, or an increase in pay. But when the financial incentive becomes disproportionate to the effort, responsibility, and stress required, it creates a moment of pause. Should I say yes to that extra work? Is the reward really worth it?

And perhaps most crucially, could I be financially worse off for doing more?

This is especially relevant to a group now commonly referred to as HENRYs—High Earners, Not Rich Yet. Now I didn’t know who this group was when it was brought up over the weekend but it turns out these are individuals typically earning between £70,000 and £120,000, often working in demanding professional roles, raising families, paying mortgages, and contributing

significantly to the economy. On paper, they’re doing well. But the reality can feel very different. Rising childcare costs, higher interest rates, and escalating living expenses are squeezing everyone including this group, which is supposedly leading many to feel stuck between ambition and affordability. The £100,000 tax cliff only adds to that pressure, creating a sort of ceiling that feels artificial, and at times, punitive.

This isn’t just a financial issue; it’s also a cultural and operational one for businesses. If we know that employees may feel demotivated or discouraged from progressing because of how the tax

system affects their take-home pay, what does that mean for retention and progression? Are we unintentionally limiting talent growth by failing to recognise the true impact of taxation beyond the headline rates? And what can employers do to better support their teams in navigating these thresholds?

It starts with awareness. Too often, salary discussions focus solely on gross income, without consideration for how tax structure, benefits, student loans and allowances affect real-world outcomes. Employers need to understand that, for many professionals, crossing that £100k line isn’t a simple milestone—it’s a tipping point. For those managing compensation, offering more thoughtful payment packages that incorporate elements like pension contributions, flexible benefits, or tax-efficient perks can make a significant difference. It’s not just about paying people more, but about helping them make the most of what they earn.

As someone who has spent much of my career advocating for transparency and sustainability in business, I find this situation troubling. Our tax system should be designed to encourage success, not to discourage people from progressing. When individuals start to avoid promotions or extra responsibility because of what it will cost them financially, we’re heading in the wrong direction. I’ve always believed that contribution to society—whether through taxes, employment, or innovation—should be celebrated and supported. But that contribution must also feel fair and proportionate.

The truth is, the people most affected by this threshold are not the ultra-wealthy. They are the business owners, department heads, consultants, and professionals who work long hours, take on significant risk, and support others around them. Penalising them through overly complex and harsh tax rules sends the wrong message. It says: stay where you are. Don’t stretch. Don’t strive. And that’s something we can’t afford—economically or socially.

There’s no easy fix. Tax reform is complex. Talking openly about the realities professionals are facing is the first step. We should feel able to question systems that no longer serve us and to push for smarter, more compassionate frameworks that encourage ambition, reward responsibility, and support the middle layer of our workforce—not just those at the very top or bottom.

It’s not about avoiding tax or gaming the system. It’s about designing a fairer one—where effort and reward stay in healthy proportion, and where success doesn’t have to come at a loss.The £100k tax trap is just one example of where policy and lived experience are out of step. But it’s an important one. And for many professionals—whether they realise it yet or not—it’s already shaping decisions, shifting career trajectories, and redefining what success looks like.

As leaders, we owe it to our teams, and to ourselves, to understand that impact—and to think creatively about how we support ambition, not stifle it.

Read more:
The £100k Tax Trap: Why More Professionals Are Questioning the Value of Earning More

July 24, 2025
Fleet Management Made Easy: How Mobile Tyre Services Cut Downtime for Small Businesses
Business

Fleet Management Made Easy: How Mobile Tyre Services Cut Downtime for Small Businesses

by July 24, 2025

For small businesses, time isn’t just money – it’s opportunity. Every hour your fleet sits idle means missed deliveries, delayed services, and unhappy customers.

Whether you run a courier company, a construction firm, or a mobile food business, keeping vehicles on the road is crucial for staying competitive.

While fuel efficiency and route planning usually take centre stage in fleet management, one area is often overlooked: tyre maintenance. It may sound mundane, but a single tyre issue can throw your schedule into chaos. That’s where mobile tyre fitting is quietly transforming how small businesses manage their fleets.

Tyres: The Silent Profit Leak You’re Ignoring

A worn or punctured tyre might seem like a small inconvenience, but for SMEs, it can be an expensive disruption. Imagine a van breaking down during peak delivery hours – not only does the driver lose hours waiting for a garage, but customers also experience delays, potentially damaging your reputation.

Now multiply that scenario by two or three vehicles over the course of a month, and you’re looking at a serious impact on revenue. According to industry estimates, even an hour of downtime per vehicle can cost small businesses hundreds of pounds in missed jobs, rescheduling, and additional staffing costs.

Traditional tyre maintenance doesn’t help much either. Sending vehicles to garages means:
Pulling drivers off their routes, often for half a day.
Queuing for service, especially during busy periods.
Extra fuel costs for travelling to and from the garage.

For growing SMEs trying to maximise efficiency, that’s a hidden cost that adds up fast.

Mobile Tyre Fitting: The Smarter Way to Keep Moving

Mobile tyre fitting solves this problem by flipping the traditional model. Instead of sending vehicles to a garage, tyre specialists come to you – whether that’s your depot, office, or even a worksite. They bring everything needed to replace, fit, and balance tyres on the spot, usually in less than an hour.

4 Ways Mobile Tyre Fitting Helps SMEs

Reduced Downtime

Your vehicles stay where they are. Drivers can continue working until the last possible moment before the tyre change, minimising lost hours.

Lower Operational Costs

Fewer hours off-road means more completed jobs, less rescheduling, and lower fuel costs. Over time, this translates to better profit margins.

Preventive Maintenance

Many mobile tyre services check tyre wear patterns, pressure, and even alignment issues. Catching these problems early prevents expensive blowouts or roadside breakdowns.

Emergency Support

Some providers offer 24/7 callouts, which is a lifeline for businesses with late-night operations, such as couriers or food delivery services.

Why SMEs Can’t Afford to Ignore It

Big corporations can absorb occasional delays. Small businesses can’t. Your competitive edge comes from reliability – customers expect you to turn up when you say you will. And in industries where word of mouth and repeat business matter, even a single missed job can push a client to a competitor.

Mobile tyre fitting might seem like a minor operational tweak, but it sends a strong message: you’re serious about efficiency, reliability, and professionalism. It’s the kind of behind-the-scenes decision that customers never see but definitely feel when you always deliver on time. There’s a reason more small business owners are choosing mobile tyre fitting over traditional garages – it’s quicker, smarter, and designed for real life. Whether you’re at work, home, or halfway to the shops; Fife Autocentre brings expert mobile tyre fitting to you, when it suits you.

Making Mobile Tyre Fitting Part of Your Fleet Strategy

If you manage more than a couple of vehicles, consider building regular tyre checks into your fleet schedule. Many mobile services now offer ongoing contracts for businesses, which means:

Monthly or quarterly inspections to prevent wear-related issues.
Priority emergency callouts for fleet customers.
Bulk discounts, making it cost-effective for SMEs.

By treating tyres as part of your overall business strategy – rather than just a reactive repair – you turn a potential weak link into a competitive strength.

Final Word

In today’s competitive market, small businesses can’t afford unnecessary downtime. By integrating mobile tyre fitting into your fleet management strategy, you’re not just fixing tyres – you’re improving efficiency, protecting your reputation, and keeping your business moving. Sometimes, the smallest operational changes deliver the biggest wins.

Read more:
Fleet Management Made Easy: How Mobile Tyre Services Cut Downtime for Small Businesses

July 24, 2025
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