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British Farmers Protest Inheritance Tax in Central London
Farmers from around the UK came to Whitehall on Monday to protest against changes to inheritance tax (IHT) reliefs. Ben Rosen TEP, Partner and head of the Quastels Private Wealth and Tax team, was in the heart of the action to find out just what they had to say.
Why Farmers are Protesting
The farmers at the protest told Ben that they were worried for the future of British farming if the government proceeds with its plans to limit claims for agricultural property relief (APR) and business property relief (BPR) to a rate of 50% on assets over £1 million. There were concerns that given the high value of farmland compared to the profits made from agriculture, farmers would not be able to afford to pay IHT on death without selling the farm.
This could mean families losing farms they have owned for generations. Farmers also thought it likely it would deter the next generation from pursuing a career in agriculture. Often the children of farming families have spent most of their lives working for little financial reward on the family farm, in the expectation that one day they will inherit it. If they think the farm is instead going to have to be sold to pay tax when their parents die, that will look a lot less attractive.
The Impact of These Changes
Farmers spoke of their anger at the proposed changes, and thought more direct action such as withholding food might follow if the government continues on its course.
The changes to APR and BPR mean that farmers, landowners and business owners are going to be more reliant than ever on expert advice to help them plan their succession in the most tax efficient way
The team at Quastels are here to help. Ben has been joined by Jack Burroughs TEP, previously of the Country Land and Business Association’s tax team. Between them they have a great depth of experience and expertise in advising farmers, landed estates and family businesses.
Get In Touch
For those worried about the impact changes to IHT reliefs could have for them, Ben and Jack will be able to help them understand their options and find the most tax-efficient solutions that meet the needs of their families and businesses. They also have colleagues at Quastels who specialise in helping farms, estates and businesses in other areas of law, including employment, property, commercial law and dispute resolution.
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Quastels Advises on Partnership Between ELEMIS & Aston Martin Aramco Formula One™ Team
Quastels are proud to have advised on the new multi-year partnership between Aston Martin Aramco Formula One™ Team, and our long-term client, ELEMIS. Led by Corporate & Commercial Legal Director Ann-Maree Blake, the deal sees ELEMIS become the first Official Skincare Partner of Aston Martin Aramco Formula One™ Team, tapping into the growing female fan-base of the sport.
ELEMIS Champions Inclusivity in F1
ELEMIS, through this trailblazing partnership, are working to promote inclusivity within Formula 1, as the latest study suggests that the fastest growing fanbase are women aged 16 to 24, and that the female demographic now make up 41% of the sport’s overall fanbase. Ann-Maree led contract negotiations on behalf of ELEMIS, ensuring the B Corp company’s sustainability focus was spotlighted in the deal, meeting with Aston Martin Aramco’s own sustainability goals. This partnership not only marks an incredible milestone in the world of Formula 1 but also sets a new standard for innovation, sustainability, and inclusivity within the sport.
The deal includes ELEMIS launching exclusive, limited-edition product collections, offering guests at the Aston Martin Aramco Paddock Club Suite experiential treatments, and in May, at the Monaco Grand Prix, ELEMIS will create a luxury spa experience on board the Aston Martin Aramco yacht- all within the first year of the partnership.
Testimonial
“Working with Ann-Maree Blake at Quastels was nothing short of extraordinary. Her unparalleled expertise, strategic vision, and tireless commitment to our success transformed what could have been a complex deal into a flawless, high-impact partnership with the Aston Martin Aramco Formula One™ Team. Ann-Maree went above and beyond, not just meeting but exceeding our expectations at every turn. Her insight, professionalism, and passion for excellence made her an indispensable part of this landmark deal. Simply put, she is the gold standard in legal support.”
Sean C. Harrington, ELEMIS Co-Founder & CEO.
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Allocation of Tips Act 2023
How Will The New Employment (Allocation of Tips) Act 2023 Affect The Hospitality and Leisure Industries?
The landscape of tipping and service charges in the UK is set to undergo a significant transformation with the introduction of the Employment (Allocation of Tips) Act 2023 later this year.
This legislation aims to eliminate uncertainties surrounding the allocation of service charges and other tips, ensuring that employees receive their due share.
In this article, we delve into the current system and the forthcoming changes that businesses in the leisure and hospitality sectors should be aware of.
Current System: How Does It Work?
At present, “tipping” typically encompasses both tips (whether in cash or card) and service charges, which can be discretionary or mandatory. When customers give cash tips directly to staff, these tips essentially become the property of the employee. While their employment contract may stipulate otherwise, it is generally up to the individual to decide whether to share these tips with colleagues.
On the other hand, when tips and service charges are collected by the employer—whether through a tip jar on the counter or a 12.5% service charge added to the bill—the distribution methods can vary. These range from the employer determining the allocation of tips and service charges to the staff members themselves agreeing on the day’s distribution of cash tips.
Additionally, many businesses put in place a “tronc” system, being a mechanism which allows tips and service charges to be pooled and distributed among staff by a designated “Troncmaster” without direction from the employer. It is worth noting that the chosen method of collection and distribution carries tax and national insurance implications, which will not be covered in this article.
Currently, there are no restrictions on businesses deducting amounts from the collected tips and service charges before distributing them to staff. While there may be valid reasons for such deductions—such as the operational costs of administering a tronc scheme—media attention has increasingly focused on employers making significant deductions from service charges, particularly as around 80% of UK tipping now occurs via card payments.
Five key changes Under the Employment (Allocation of Tips) Act 2023 are as follows:
1. Prohibition of Deductions
Under the new legislation, businesses will no longer be permitted to make deductions from the tips and service charges collected. Every penny collected must be distributed to the staff, with deductions only permissible for tax or as otherwise authorised by law.
2. Obligation to Allocate Tips Fairly
Businesses will be obligated to allocate tips and service charges “fairly” among workers. Although the legislation does not specify what constitutes fair allocation, this is expected to be clarified in due course. Employers will be required to have a written policy outlining the fair, transparent, and consistent distribution of tips.
3. Time Limit for Payment
Tips and service charges must be paid to eligible workers no later than the end of the month following the month in which the tip or service charge was received from th
4. Record-Keeping Requirements
Employers must maintain records of the allocation and distribution of tips for a minimum of three years from the date they are received.
5. Right to Claim in Employment Tribunal
Employees will have a separate right to bring a claim in an employment tribunal if there is a breach of these requirements. The tribunal may, among other remedies, order compensation of up to £5,000 to an affected employee to compensate for any losses suffered.
Final comments
The implications of these changes are significant, particularly for employers in the leisure and hospitality sectors. With businesses already facing financial challenges, the additional administrative burden of distributing tips and service charges could strain resources. One alternative may be to pass these costs back onto customers, but this is unlikely to be popular in the current economic climate.
In light of the forthcoming legislation, it is prudent for businesses to start implementing the necessary policies, structures, and procedures now. By doing so, businesses can be better prepared to comply with the new requirements and ensure compliance from the outset.
To discuss any of the points raised in this article, please contact Adam Convisser or fill in the form below.
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