Tax letters and fund outflows: the week in news

Tax letters and fund outflows: the week in news

So as Britain returns to its desk, slightly more overweight and unhealthy after the Christmas binge, this week appears to have gone on a news diet.

But that doesn’t mean we don’t have enough to fill the week in news.

1) Taxpayers find more than just presents in their stocking

As if we don’t all have enough to worry about in the run-up to Christmas, HM Revenue & Customs thought it would send a letter to groups of people it thought may be underpaying their taxes.

Sent out just before Christmas to 10,000 individuals who declared bank interest on 2014 to 2015 self-assessment tax returns, the letters asked them to look again at the interest figures shown on tax returns with a view to checking that the declaration is correct.

The letters – which were not copied to tax agents - fall short of constituting a compliance check but Mike Down, head of tax investigations at accountancy firm RSM, said the mail shot caused “real concern to law-abiding people who fully believe that they have disclosed everything properly.”

Nothing gets the festive period going like worrying about your taxes.

2) M&G fund has no January weight woes

Whether you’re on a diet, giving up alcohol or going vegan for a month, January is the time of losing weight – or at least attempting to do so.

But that’s no problem for M&G’s £15.4bn Optimal Income fund.

According to data from Morningstar it suffered the largest amount of outflows last year.

Figures from the research provider show the strategic bond fund, which is managed by Richard Woolnough, had haemorrhaged £3.3bn in 2016.

This comes after data indicated the M&G fund had been the biggest victim of all UK funds in June, the month of the Brexit vote.

3) Reach for the stars

In the words of the philosophers S Club 7 you should “reach for the stars/climb every mountain higher”.

And some have suggested that claims of a 20 per cent return by European wealth management firm Novofina are certainly ambitious.

The company says it will launch in the UK this year bringing “start-of-the-art” algorithms.

Novofina 7plus and Novofina 20plus will be the first products to be launched in the UK and the company said that based on past simulations they aim to offer average annual net returns of 7 per cent and 20 per cent respectively.

4) Very little goodwill to all regulators

Since today is Twelfth Night, Christmas is officially over for another year and so is goodwill to all men.

But the festive season didn’t mean there was any goodwill towards the Financial Conduct Authority.

Mike Morrison, pension expert at AJ Bell, accused the FCA of regulatory bias over pension transfer rules.

He said it should review pension transfer rules based on the assumption final salary to defined contribution transfers will not be in the client’s best interests in light of pension freedoms.