Latest news with #CharlesStanley
Daily Mail
04-07-2025
- Business
- Daily Mail
Roller-coaster week sends UK yields higher
UK borrowing costs have seen their first weekly rise since May after a 'rollercoaster' ride sparked by growing fears about Labour's handling of the public finances. Ten-year borrowing costs shot close to 4.7 per cent on Wednesday after a tearful House of Commons appearance by Chancellor Rachel Reeves sparked doubts about her future. And though the moves in UK bonds – known as gilts – were mainly reversed in the following days as the Prime Minister backed Reeves, the episode added to worries sparked by the Government's humiliating climbdown on welfare reforms on Tuesday. Yields last night ended the week at 4.56 per cent, up from 4.5 per cent the previous Friday. It was the first weekly increase after a steady run of declines since mid-May. That partly reflected global moves as US bond yields turned higher thanks to worries about America's ballooning debt and trade tariffs. Nevertheless, it will pile further pressure on the beleaguered Chancellor as the increased borrowing costs will make it even harder to balance the books. Oliver Faizallah, head of fixed income research at wealth advisers Charles Stanley, said: 'This week's blowout was a reminder that the gilt market will not take kindly to excess borrowing.' Yields on UK ten-year bonds, known as gilts, began the week at around 4.5 per cent and eased close to 4.4 per cent ahead of the welfare vote in Parliament on Tuesday night – when it seemed Labour would manage largely to push through its plans. But last-minute concessions that helped the Government win the vote wiped out the intended savings. That blew a £5billion hole in the Chancellor's plans and sending yields racing towards 4.5 per cent the next day, before they climbed even further after Reeves' Commons appearance. It added to the damage to public finances caused by a previous U-turn on winter fuel payments, a deteriorating growth outlook and an increased commitment to defence spending. Andrew Goodwin, of Oxford Economics, said the volatility in gilts 'emphasises the need for fiscal discipline'. The sharp rise in yields reflected anxiety in the markets that, despite the Labour Chancellor's dismal economic record so far, her successor might prove even more of a worry by loosening the Government's commitment to balancing the books. Instead, ministers will need to try to find the missing billions elsewhere. Goodwin said: 'The experience will have demonstrated to the Government that markets will likely look unfavourably on any further loosening of the fiscal rules, increasing the chances that we see large tax rises in the Budget this autumn.'
BBC News
03-07-2025
- Business
- BBC News
UK borrowing costs fall as PM backs chancellor
The cost of government borrowing has fallen in early trade on Thursday, partly reversing a surge prompted by the chancellor's emotional appearance in the Commons the previous yield on UK 10-year bonds fell to 4.53%, down from 4.61% at Wednesday's close - as markets reacted to the prime minister's comments that he worked "in lockstep" with Rachel pound, which also fell on Wednesday, recovered some ground to $1.3668, although it has not regained all the ground it lost. One analyst told the BBC financial markets seemed to be backing the chancellor, afraid that if she left her job then fiscal discipline would disappear. Will Walker Arnott, head of private clients at the bank Charles Stanley, told the Today programme it seemed like a "rare example of financial markets actually enhancing the career prospects of a politician"."I think the markets are concerned that if the chancellor goes then any fiscal discipline would follow her out the door and that would mean bigger deficits."Mohamed El-Erian, president of Queens' College, Cambridge, and chief economic adviser at Allianz, warned that markets were likely to remain on edge."The minute you put a risk premium in the marketplace, it's very hard to take out," he told the Today programme."I suspect that we will see some moderation, but we will not go back to where we were 24 hours ago."
Times
02-07-2025
- Business
- Times
Tally of growth businesses selling up nears 8,000 in 10 years
The number of high-growth businesses choosing to sell up has hit almost 8,000 over the past ten years as founders sell their companies to corporates or float their enterprises on public markets. Acquisitions have accounted for the majority of business exits over the period, according to analysis by Charles Stanley, the investment management firm. Deals peaked in the year after the pandemic, with 1,110 acquisitions taking place. Corporate buyers accounted for 956 purchases and financial buyers for 154 purchases. The firm's research also found that almost 40 per cent of the exit activity has occurred in the last two and a half years. Cliadhna Law, head of direct and professional sales at Charles Stanley, said: 'Acquisitions remain the dominant form of exit, driven by both corporate and financial buyers, and IPOs, although less frequent, are important for high-growth firms seeking public capital and global visibility. 'A more stable exit landscape may be on the horizon, one defined by sustained acquisition activity and signs of a potential recovery in the IPO market. These changes reflect the UK's increasingly flexible approach to value realisation and the changing priorities of founders, investors, and buyers across the high-growth ecosystem.' The City is hopeful for a more sustained pick-up in company listings after it emerged Visma, a private equity-backed business software group, is considering a market debut in London. The group is based in Oslo, Norway, and has been valued at around €19 billion. Visma's potential listing comes after a number of large companies moved their listings away from London to New York, including Ashtead, the industrial equipment hire firm, Flutter, the owner of Paddy Power, CRH, the building materials supplier, and Ferguson, the plumbing group. Nikhil Rathi, chief executive of the City regulator, the Financial Conduct Authority, told business leaders last month that there was a need to 'reset the psychology' and 'put aside British modesty and celebrate' the strengths of UK markets. In a speech in the City, he said: 'We have world-leading banking, insurance, derivatives, debt, foreign exchange and commodity markets and infrastructure. We lead Europe in fintechs and are second only to the US in investment management.'
Daily Mail
11-06-2025
- Business
- Daily Mail
Borrowing costs rise as Reeves splashes cash: Nervous investors fret over spending spree
British borrowing costs edged higher yesterday as 'nervous' investors fretted over how Rachel Reeves will pay for her lavish spending spree. The yield on ten-year gilts rose as high as 4.62 per cent on speculation that the Chancellor will be forced to increase borrowing or raise taxes to make her Budget numbers add up. It eased later in the session to 4.55 per cent – thanks to weaker-than-expected US inflation boosting hopes of interest rate cuts across the Atlantic – but remained the highest in the Group of Seven major industrialised nations. This means that Britain is paying more to borrow on international bond markets than every other leading developed economy on Earth. Oliver Faizallah, an analyst at wealth manager Charles Stanley, said: 'Markets remain nervous about the potential for either higher taxes or an increase in borrowing in the future. 'An increase in taxes may be seen as more market-friendly, but would be politically damaging, while an increase in borrowing would put further pressure on already elevated gilt yields. Fiscal concerns in the UK will no doubt keep gilt yields higher for longer.' He noted that the easing in gilt yields after early rises 'had nothing to do with the spending review but came on the back of lower-than-expected inflation in the United States'. US inflation nudged up only slightly from 2.3 per cent in April to 2.4 per cent in May, lifting pressure on bond yields around the world. The mood was further boosted after US President Donald Trump declared that a US-China trade deal is 'done' – an announcement that suggested tensions between the world's two largest economies were thawing. It was not enough, however, for the FTSE 100 to close at new highs, with the index ending the day up just 0.1 per cent at 8864.35, having spent much of the session above March's record close of 8871. Investors warned that doubts remain over Labour's handling of the economy – and the outlook for tax, spending and the public finances. 'Another fiscal event goes by with little resolved in terms of allaying investor fears that fiscal policy is on a sustainable footing,' said Neil Mehta, portfolio manager at capital market company RBC BlueBay Asset Management. 'With Labour's favourability rating in free fall with the public, the Government is bending to political pressure and proposing a raft of spending measures, seemingly taking their eye off the ball regarding fiscal responsibility. 'Until fiscal policy is brought back on a sustainable path, investors will continue to demand a higher premium for investing in UK assets, such as gilts, than peers.' Gordon Shannon, a fund manager at Twenty Four Asset Management, said he was 'disappointed that there wasn't more clarity' on how the Chancellor intended to meet her fiscal rules. Matthew Amis, investment director at Aberdeen, said that Reeves yesterday had 'offered just enough detail and security for the gilt market to focus away from the UK's fiscal situation until the autumn at least'. But he added: 'Scrutiny will be high and any mis-step from the Chancellor will be reflected in higher gilt yields. 'Big decisions are required from Chancellor Reeves in the autumn.' Ian Stewart, chief economist at Deloitte, said: 'The autumn Budget will be the big test of whether the Government's fiscal plans are holding in the face of global economic headwinds.'
Daily Mail
30-05-2025
- Business
- Daily Mail
I have £20,000 in shares from an old employer, can I cut my capital gains tax bill?
I have £20,000 worth of shares held outside of an Isa from an old employer's share save and employee share schemes dating back to when I worked there between 2008 and 2014. I would like to sell the shares and reinvest the money into more diversified investments but think I will end up with a big tax bill, even though I am a basic rate taxpayer. I have been reinvesting dividends and buying more shares regularly throughout the ownership. What do I use as the purchase price for capital gains tax – each individual share price or an average? And is there any way that I can cut my tax bill if I sell? The shares are held as certificates, if I keep hold of them, can I move them into an investment account? Rob Morgan, chief analyst at Charles Stanley Direct, replies: Gains on shares purchased at various points through additions such as reinvesting dividends can appear be something of a tax headache. However, if you have kept good records the calculations in most circumstances aren't too bad. Capital gains tax rules First the basics. Capital gains tax (CGT) is a tax on any profits made on investments, and as you are aware you will be potentially liable on the sale of shares held outside a tax-efficient account such as an Isa. The amount of tax you're charged depends on which income tax band you fall into. For the 2025/26 tax year, rates of CGT are 18 per cent and 24 per cent for basic and higher rate taxpayers respectively. This rate applies to the profit made – so sale proceeds minus the cost of purchase. > What is capital gains tax? Read Charles Stanley Direct's guide Not widely understood is the interaction of CGT with income tax bands. If you're a basic rate taxpayer, any gain taken when added to your income could push you into the higher-rate bracket. If so, you'd pay 24 per cent on however much of the gain falls into the higher income tax band when added to your income, and 18 per cent on the portion below it. If you are a Scottish taxpayer your CGT rate depends on the rest of UK income tax bands and not the Scottish tax bands. You'll only need to pay tax if your realised profits in a tax year exceed the annual capital gains tax allowance. In the 2025/26 tax year, this is £3,000. For example: If you bought shares for £10,000 and sell them this tax year for £30,000, then you've made a capital gain of £20,000. If you have no other gains, this is reduced to £17,000 as the first £3,000 falls into the CGT annual exemption. For a basic rate taxpayer (with income and gains falling below the higher rate tax band) the tax liability is £17,000 x 0.18 = £3,060 However, if the gain tips you into the income tax higher rate band then you pay the higher rate of CGT on the portion over the threshold of £50,270. For this reason, many basic rate taxpayers can end up paying mostly higher rate CGT on large gains. Calculating CGT from multiple purchases Calculating the gain on shares and the tax to pay is reasonably straightforward if you have the figures to hand. In most circumstances you just need to know the number of shares and the total amount paid for them by adding up all the purchase transactions. You then net the total cost of the sale proceeds (after any fees such as stockbroking commission) to calculate the gain. When making multiple sales the purchase cost simply applies on a 'pro rata' basis to each sale. The main exception to this 'pooling' rule is the 'same day' rule whereby shares acquired on the same day as the disposal are taken account of ahead of any others. There is also the 'bed and breakfasting' or '30 day' rule whereby any shares repurchased within 30 days cancel out the gain or loss generated by the prior sale – but not if repurchased in an Isa. However, it appears neither of these apply in your circumstances. As with many tax matters, there are examples and help sheets on the HMRC website that can help, but as with any tax issue if you are in any doubt you should consult a qualified tax specialist. Ways to minimise CGT To mitigate CGT there are some strategies you can adopt. If the capital gain, and therefore the potential tax liability, is significant you can consider taking advantage of the CGT allowance over multiple tax years. The allowance has been much diminished and now stands at just £3,000, but selling an asset in bits over time can help minimise CGT. You can't do that with a second property or an antique of course, but you can with shares and funds. If you are planning to keep some or all your holding you can consider using the £20,000 Isa allowance to at least protect it from tax going forward – both in terms of income tax on dividends and any future gains. The process here is known as a 'Bed & Isa' which can help use your CGT and Isa allowances simultaneously. A Bed & Isa involves selling holdings and then buying them back in an Isa account. The sale part generates a capital gain, so selling or partially selling an existing investment could help with tax planning by using some of your capital gains allowance while keeping your holding. > Bed & Isa and other Isa rules to make your life easier: Charles Stanley's guide Outside of an Isa or pension you are prevented from generating gains in this way owing to the 'bed and breakfasting' rule mentioned above. This highlights that prevention is often easier than cure when it comes to CGT. Buying shares in an Isa, or transferring them in at the earliest opportunity, is often the best way to avoid storing up problems further down the line. One valuable tactic that many people miss is the special rules around transferring eligible shares from a save as you earn (SAYE) or share incentive plan (SIP) scheme tax free into an Isa within 90 days of acquisition. Potentially, it's a great way to use your Isa allowance and shelter up to £20,000 of a holding from tax. Another strategy to reduce CGT involves transferring some of the asset to a partner if you are married or in a civil partnership. You usually don't pay capital gains tax on an asset you give or sell to your husband, wife or civil partner, and this could give you the option of using two CGT allowances each tax year. A couple, for instance, could realise gains of up to £6,000 this tax year without paying tax. You could also consider dividing the shareholding in such a way to take advantage of lower tax bands where one partner's income is lower. This way there may be less tax to pay on the gain as more of it falls into the basic rate band than the higher rate band for one of the pair. Finally, if you have any losses on investments elsewhere you may have opportunity to set these off against gains. If you sell an asset for less than you paid for, you can report that loss to HMRC to offset against any gains you've made in the same tax year. You have up to four years from the end of the tax year in which the loss occurred to make a claim. This can reduce your overall taxable gain and in some circumstances bring it below the annual CGT allowance. Keeping the shares It can be difficult to know whether to sell a shareholding with a tax liability attached to it. Much depends on the outlook and reliability of the company in question and the level of risk the holder is happy with. The rule of thumb is that the tax tail shouldn't wag the investment dog, and in the case of a large single stock position it can be wise to diversify to limit the impact if it falls in value. That's especially the case if a drop could have a big impact on your financial resilience. Having your financial future heavily influenced by one business is a risk most people wouldn't be willing to take – unless they are inexorably attached to it through ownership or otherwise have significant confidence in the prospects. A diversified approach won't guarantee a better result, but it's far less risky. Ideally, a careful strategy around sales can help minimise the tax burden and smooth the path towards that. We have only seen the tax burden ratchet over time, and it seems a forlorn hope that it might reverse direction, at least in the near term, so from that perspective there may be nothing to be gained by putting off the issue. However, if you decide to keep your shares, contact your stockbroker or investment platform to see if they can help with 'dematerialising' them. In other words, converting them from a physical certificate into electronic form. This will make things easier to manage going forward if you want to keep them. It will also mean future sales are easier to execute and will cost less as brokers generally charge a lot more for a certificated sale. You'll have to fill in some paperwork to do this and wait a short period for the process to complete. For instance, at Charles Stanley once the original share certificates and signed transfer forms are received we would expect the holdings to be deposited in an online account within 5 to 10 business days under normal circumstances.
