RSM Tenon withdraws tax products following Budget
Closure of business line follows introduction of general anti-avoidance rule in the Budget in March.
Accountancy and advisory business RSM Tenon has said it will cease offering new products through its specialist tax service line following the enactment of the general avoidance rule in the government’s recent budget.
Although this means the company will no longer take revenue from this branch of its business, it claims the decision will have “limited” impact on revenues in this financial year as much of the revenue from this had been earned prior to the budget announcement.
The company has also reported that its plan to save £14m by making 10 per cent of its staff redundant is “well underway”, with about 75 per cent of the savings already secured.
With an overall head-count of about 3,000, this works out to around 300 redundancies made by the end of the company’s financial year.
By June 2012, the company aims to have completed the plan and in fact to have achieved “savings in excess of our original estimates”.
Costs attached to the staff reduction programme are estimated at £6m, which Tenon said will mean it will have limited room to manoeuvre within its borrowing facilities until it begins to benefit from the programme in the second quarter of its financial year.
The company agreed a deal with Lloyds Banking Group in February that will see the bank extend “committed facilities” of £88m to the company until October of this year.
Chris Merry, chief executive at RSM Tenon, said: “We are making good progress in delivering the actions that we identified in our interim results announcement on 29 February 2012.”