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New rules to simplify access to Child Trust Fund accounts of loved ones who lack mental capacity “without need to go to court”

Palmers Solicitors in Essex

New rules will make it possible for families to access the Child Trust Fund (CTF) accounts of loved ones who lack mental capacity without the need to go to court, it has been announced.

It comes after research revealed that thousands of children with disabilities are unable to access savings because of complicated rules.

CTFs – which were replaced by the Junior ISA scheme in 2011 – are long-term tax-free savings accounts available to children born between 01 September 2002 and 02 January 2011. Parents or guardians could set up an account on behalf of their child with a CTF provider, such as a bank, building society or investment manager.

At age 16, the account holder can choose to manage their CTF themself, and at age 18, can withdraw money from the fund.

However, the latest research suggests that “thousands of accounts” have yet to be claimed.

Under current legislation, a family member or guardian must apply to the court to manage funds if the account holder lacks mental capacity and cannot manage their finances.

While these rules are designed to protect vulnerable people from fraud or abuse, it means that families are forced to spend a disproportionate amount of time and money to gain access to children’s funds.

The new rules, announced by the Government this month, will introduce a “simpler and quicker” system that will ease the administrative burden on families while still maintaining important safeguards.

The consultation document proposes that the scheme will be run by the financial services sector, who will require medical evidence to certify that the account holder lacks the mental capacity to manage their own financial affairs, as well as verification that funds will be used in the best interests of the account holder.

Approved withdrawals may also be paid directly to the provider of goods and services instead of the applicant.

Commenting on the plans, Deputy Prime Minister, Lord Chancellor and Secretary of State for Justice, Dominic Raab, said: “I’m determined to reduce the obstacles families and guardians face when they are supporting vulnerable people who lack mental capacity.

“These plans will make it easier and less stressful to access small funds while maintaining vital safeguards to prevent abuse and fraud.”

Dan Scorer, Head of Policy and Public Affairs at the learning disability charity Mencap, added: “Over the last year families of young people with a learning disability have highlighted the significant barriers and cost faced in accessing Child Trust Fund money for their loved ones. It is welcome action is being taken to consult on proposals for a more proportionate process where small amounts of money are involved.

“The complexity of the legal system is a recognised barrier and the aim of a simpler and quicker process, which still has appropriate safeguards, is welcome. We will look carefully at the proposals in the consultation, but changes made must both make it easier for family members to access funds for their loved ones whilst including appropriate safeguards.”

For help and advice with related matters, please get in touch with our private client team today.

Beyond London: what are the best cities for tech start ups in the UK?

Palmers Solicitors in Essex

Manchester has been crowned the best city outside of the capital to launch a tech start up.

The research, published by software developers KLOC in collaboration with sector analysts Crunchbase, uses a variety of factors to determine the best and worst regions across the UK.

These include the number of start-ups per area, the total funding raised per business, the average software engineer salary, and how the region’s top university ranks for computer science, with each factor scored out of 10.

According to the analysis, Manchester – which hosts the joint-highest number of start-up businesses outside of London – ranks first with the highest overall score of 27.38.

Cambridge follows in second place with an overall score of 25.72, while Edinburgh placed third with an overall score of 24.85.

Guildford, Oxford, Bristol, Glasgow, Altrincham, Sheffield, and Belfast also ranked among the top cities for tech start-ups.

Commenting on the findings, the authors said: “The study highlights that there are plenty of vibrant tech start-up scenes outside London.

“This is very encouraging for entrepreneurs as it demonstrates that there are plenty of options beyond the capital which can offer lower operational costs and still provide a talented workforce.”

For help and advice with related matters, please get in touch with our corporate finance team today.

Persuasion is the best method of getting NHS staff vaccinated say unions

Palmers Solicitors in Essex

Frontline NHS workers and their representatives have reacted to the Government’s decision to introduce mandatory COVID-19 vaccinations for staff.

Both the Royal College of Nursing (RCN) and the union Unite have called for persuasion rather than a heavy hand when implementing the measure.

Unite, which has 100,000 members in the health service, said that persuasion and not coercion was the best way to drive up vaccination rates, while the RCN believes that support and education would be more effective in increasing uptake across health and care staff. 

Health Secretary Sajid Javid has announced that frontline NHS workers and social care staff would need to be fully vaccinated to continue in their jobs from 1 April next year.

Anyone without medical exemption and in direct contact with people while providing care will be required to have two doses, said Mr Javid.

Following proper procedures

The move has raised concerns that the mandate could cause a large exodus from the NHS and that enforcing it could create legal risks both in the NHS and for other industries, over potential discrimination in areas like disability, maternity, religion or unfair dismissal.

So the NHS and its HR departments must follow the proper procedures to implement the policy.

The mandate applies to health and wider social care settings regulated by the Care Quality Commission (CQC) and includes doctors, nurses, dentists and domiciliary care workers.

According to the Department of Health, 103,000 people working in the NHS in England remain unvaccinated.

COVID-19 vaccines have already been made compulsory for staff working in care homes in England, with a deadline of 11 November.

Scotland and Northern Ireland have not yet made vaccines compulsory for NHS workers or care home staff. Welsh ministers have announced that they will not make vaccines mandatory. 

The latest data on NHS workforce vaccination shows that 93 per cent have received their first dose and 90 per cent have received two doses.

Engage with the small minority

The RCN believes that those who choose not to be vaccinated should be risk assessed by their employer and deployed appropriately. 

General Secretary & Chief Executive Pat Cullen said: “With the five months until this decision takes effect, the Government and employers must continue to engage with the small minority who have chosen not to have the vaccine. 

“This is vital to understanding their concerns, supporting them to understand the importance of the vaccine and to make that important choice.”

For help and advice on employment matters, contact our expert team.

New laws and code of conduct to help protect businesses from eviction

Palmers Solicitors in Essex

Commercial property tenants will be further protected from eviction after the Government announced new laws and a code of practice to deal with rent arrears.

The Government announced a ban on business evictions at the start of the pandemic, which remains in force until March 2022.

Under the new temporary measures, landlords will not be able to chase business tenants for rents through the courts, in a move aimed at encouraging firms to negotiate the estimated £7 billion of debts accrued during the pandemic.

The new measures include:

  • Laws to provide a legally-binding process to resolve the remaining commercial rent debts
  • A new Code of Practice published to guide landlords and tenants in how to negotiate a way forward
  • Changes that will protect tenants from rent debt claims against them and help the market return to normality

The move was welcomed by the hospitality industry. Kate Nicholls, chief executive of trade body UKHospitality, said: “We share Government’s view that arbitration should be a last resort and this process must take into account the exceptional and existential level of pain that hospitality businesses have faced over the last 18 months.”

The measures, announced by Business Secretary Kwasi Kwarteng, says negotiations on arrears will be underpinned by the new Code of Practice, providing landlords and tenants with a clear process for settling outstanding debts before the new arbitration process comes into force.

The Code says tenants unable to pay in full should negotiate with their landlord in the expectation that the landlord waives some or all rent arrears where they can do so.

The Government says commercial tenants will be protected from debt claims, including County Court Judgements (CCJs), High Court Judgements (HCJs) and bankruptcy petitions issued against them concerning arrears from when they had to close for lockdowns.

From 25 March 2022, new laws introduced in the Commercial Rent (Coronavirus) Bill, introduced in Parliament, will establish a legally-binding arbitration process for commercial landlords and tenants who have not already reached an agreement, following the principles in the Code of Practice.

The Bill, expected to come into force next year, will apply to commercial rent debts related to certain businesses such as pubs, gyms and restaurants which were forced to close during the pandemic.

Debts accrued at other times will not be in the scope of the new laws, which will come into force in England and Wales, and Northern Ireland will have a power in the Bill to introduce similar legislation.

For help and advice with commercial property matters, please get in touch with our expert team today.

Inheritance tax receipts rise as deaths and enforcement activity increase

Palmers Solicitors in Essex

Inheritance tax receipts increased by more than £700 million in the last six months compared to the same period last year, the latest figures have revealed.

The report, published by HM Revenue & Customs (HMRC), reflects the greater number of “wealth transfers” that took place during the coronavirus pandemic, as well as a sustained focus on enforcement activity.

According to the research, the tax authority collected a total of £3.1 billion in inheritance tax between April and September 2021 – around 29 per cent more compared to last year’s figures.

While the hike has in large been attributed to rising deaths, the report also reveals sustained enforcement activity. In the 2020/21 tax year, HMRC launched 3,574 inheritance tax investigations resulting in an additional £254 million in tax revenue.

Commenting on the figures, a spokesperson for HMRC said: “The majority of people pay the correct inheritance tax. Investigations are opened into the small proportion of cases where compliance issues have been detected to ensure that everyone pays their fair share of tax.

“The number of inquiry cases and amount of tax we bring in each year changes as cases are opened and closed, and any tax owed is paid.”

Inheritance tax: how much do I have to pay?

With an increasing number of families under the scope of HMRC enforcement activity, paying too little inheritance tax – or indeed too much – is often a worry.

Inheritance Tax (also known as IHT or the “death tax”) is charged at 40 per cent on the value of your estate that exceeds the Inheritance Tax threshold – currently £325,000, or £650,000 when combined with a spouse or civil partner.

If you are passing down property, you may also benefit from the residence nil-rate band. This increases your tax-free threshold by £175,000, but only if you leave your principal home to children (including adopted, foster or stepchildren) or grandchildren.

Any unused nil-rate band can be transferred to a surviving spouse or civil partner, increasing the maximum available threshold to £1 million.

Get advice today

For help and advice with related matters, please get in touch with our later life planning team today.