ABC Money

Airline flight delay & compensation policies

News

Sam Allcock

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18 April 2016

Not sure if your flight compensation claim will scale through? Here is a look at the flight delay compensation policy as provided under the EU legislation 261.

Compensation is only for EU-regulated flights

An EU regulated flight is one that departed from an EU airport regardless of the airline or where the airline landed at an EU airport. This law means that airports in Norway, Switzerland, Liechtenstein and Iceland are covered, as well as any other EU country.

Claims can only go as far back as 2010

Theoretically, you can file an indemnity for delays dating as far back as February 2005. In reality however, you will not be able to claim settlement for delays over 6 years. In our experience handling thousands of claims, the flight reparation policy for most airlines has 6 years as the limit (as of 2016). This is because the EU does not have a clear regulation on this front and legal requirements in England mean the airline can only be held accountable for events that happened no later than six years ago. The allowance is 5 years for cases in Scotland.

The airline must be at fault

You are due a pay out if the delay you are faced with, is something within the airline’s control. This means that you are due compensation for staffing or under booking induced delays. Delays as a result of bad weather and political unrest do not count.

EU guidelines released in 2013 outline scenarios where passengers can claim compensation. However, case law created over time has invalidated some of the scenarios covered. For example, the guidelines do not have provision for making a claim following a technical problem on the part of the company but many clients have received compensation in such a scenario. The key is to demonstrate that the company did not do everything it could to prevent a delay.

Delays must be at least 3 hours to be valid

You can only claim compensation if your flight was delayed by at least 3 hours. The longer the delay, the more the amount of compensation you are entitled to. Bear in mind that this rule is about when you arrive and not when you leave the airport. Currently, if your flight takes off 4 hours late but arrives 2 hours 55 minutes late, you are not due compensation. But the law may change in future, as it has done in the past. It is also important to note, that arrival time here is adjudged to be when at least one of the doors on the plane is opened not when it touches down. This ruling was made in 2014.

The policy for delayed flights is therefore constantly changing but at airclaims.co.uk, we are always in the loop. You can count on us to take the guesswork out of the process for you.

The battle is on to save Britain’s steel industry

Elliot

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11 April 2016

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The battle is on to save Britain’s steel industry

The United Kingdom’s business secretary Sajid Javid is to update parliament this week on the battle to save the UK’s steel industry. The crisis in the sector has seen the threat of plant closures looming in Scunthorpe and Port Talbot.

Javid is hoping to announce to fellow MPs that Tata’s Scunthorpe steelworks, which have been on the market since 2014, have been taken over by Greybull Capital.

The business secretary has been under major pressure over the steel crisis and he will also aim to provide an update on whether there has been any progress in securing an investor for the rest of Tata’s UK operation, with 40,000 jobs potentially at risk.

Emergency meetings have been taking place and Javid recently visited the Tata chairman, Cyrus Mistry in Mumbai after the firm announced it would dispose of its British assets, which are costing the business £2.5m a day.

Javid believes he may have a potential buyer in the shape of Sanjeev Gupta, the executive chairman of Liberty House.

Steel unions would welcome positive news for the industry regarding the Scunthorpe deal and also hope that the long term future of Tata’s main steelworks at Port Talbot, which employ 15,000 people, can be secured.

Stephen Doughty, MP for Cardiff South and Penarth, delivered a firm message on the subject and was quoted in the Guardian saying: “The question on the lips of steel MPs will be whether Sajid Javid will put anything new or substantive on the table to help save our steel industry, or whether it will be just more warm words like we have seen so many times in the past.”

“Has all the belated jetsetting of him and the foreign secretary in recent days secured any real commitments? Or were they just a last-ditch attempt to look busy and make up for months of failure?”

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Panama papers leave questions unanswered as dust begins to settle

Elliot

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8 April 2016

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Panama papers leave questions unanswered as dust begins to settle

With the benefit of hindsight days after the leaking of documents from Panama-based law firm Mossack Fonseca, one of the world’s largest offshore management companies, serious questions are being asked of the global establishment across all five continents.

Several nations are investigating possible financial crimes by the wealthy and powerful, after 11 million documents held by Mossack Fonseca were passed to German newspaper Sueddeutsche Zeitung. That publication then passed the documents to the International Consortium of Investigative Journalists and in the UK the BBC and The Guardian joined a list of 107 media outlets in 76 countries to examine and investigate the contents.

The BBC state that they still do not know the identity of the original source. Whoever it was has sent political shockwaves across the world this week.

The company at the centre of the storm, Mossack Fonseca, appear to have assisted clients evade tax, but the firm say they have been misrepresented by the leak and deny doing anything wrong.

Iceland’s prime minister Sigmundur David Gunnlaugsson stepped aside this week – reportedly temporarily – after the ‘Panama papers’ revealed he owned an offshore firm with his wife, which he allegedly did not disclose when entering parliament. Gunnlaugsson denies any wrongdoing.

Meanwhile Russia’s president Vladimir Putin is reported by the BBC as denying “any element of corruption” over the leaks, stating that his opponents are trying to destabilise his nation. The papers cited several offshore firms owned by close friends of Putin.

Mr Putin said in a television broadcast, “Western opponents are worried by the unity and solidarity of the Russian nation and that is why they are attempting to rock us from within, to make us more obedient. They’ve found a few of my acquaintances and friends and scraped up something from there and stuck it together.”

The Guardian reports that ‘among national leaders with offshore wealth are Nawaz Sharif, Pakistan’s prime minister; Ayad Allawi, ex-interim prime minister and former vice-president of Iraq; Petro Poroshenko, president of Ukraine and Alaa Mubarak, son of Egypt’s former president.’

Meanwhile in the UK prime minister David Cameron is under scrutiny from media and opposition politicians over an offshore investment fund run by his late father Ian, who passed away in 2010. Mr Cameron Senior’s fund Blairmore Holdings has been registered with HMRC since it was founded and always submitted detailed tax returns. David Cameron admits he sold a profitable stake in the investment fund for around £30,000 before he became Prime Minister.

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New build housing boosts UK property market

Elliot

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6 April 2016

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New build housing boosts UK property market

Before you take a look at the current property market, you would be wise to brace yourself. After all, prices have risen exponentially over the course of the last 18 months, with the recent month of March even seeing valuation rise at their fastest annual pace in more than a year.

With many claiming that the average UK house price could have risen beyond the £1 million mark by 2030, there is no doubt the market is facing a period of steep decline, potential inactivity and a potential collapse. This situation has been exacerbated by a lack of supply, with home-owners keen to retain their most valuable asset as long as the value of the market is increasing.

This is helped to create a seller’s market where demand far exceeds supply, triggering unsightly bidding wars and hugely overvalued price points.

How will the Nation respond?

In truth, this should come as any sort of a surprise. After all, after a leading think tank concluded that 250,000 new homes would need to be built to meet the prevailing demand back in 2014, it was later revealed that just 150,000 were actually completed. This ongoing issue has created a shortfall in housing supply, which in turn has been compounded by rising price points and a desire to keep owned-homes off the market. With the private rental and buy-to-let markets also having thrived recently, owners are more inclined to rent out homes rather than sell them.

So how will the nation respond to this challenge?

As you would expect, the primary response has been to invest in the construction of additional new build home. Private sector firms have even been allowed to purchase public land, creating more space for housing estates and typically uniform designs. It is hoped that these projects will create a huge resource of affordable housing once completed, creating greater equilibrium in the market place and forcing existing vendors to offer superior value to buyers.

Can New Build Housing save the Property market once again?

New building housing is often seen as the saviour of an ailing or imbalanced property market, and this certainly worked in the wake of the great recession in 2008. Then, new build homes were sold as part of initiatives that helped stricken buyers and those with poor credit scores, helping those who had been decimated by the recession to regain their foothold on the property ladder. Times have changed, however, and there is evidence to suggest that new build housing may no longer hold the appeal or influence that it once had.

The plethora of projects has created even more compact and uniform designs, however, while the sheer magnitude of work has heralded the dawn of simplistic structures. Such homes are increasingly impractical and unpopular, with a recent report by the Guardian suggesting that just one in four potential buyers would choose to purchase a home built in the last 10 years. Many would rather rent than buy a new build, while the issue of affordability is also relative in an economy where wages have stagnated while inflation soars.

So while the theory of building new houses is a logical response to a shortfall in supply, it will mean little if the British public would rather hold on to their deposits and rent instead.

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RAC reports rising petrol prices after period of cheaper driving

Elliot

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5 April 2016

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RAC reports rising petrol prices after period of cheaper driving

The RAC have reported that fuel prices are on the rise after the first rise since July 2015, with the increase on average being 3.4p per litre nationwide.

The organisation is warning motorists that the sustained period of cheaper petrol prices – resulting from a drop in oil prices globally – is now coming to an end. However, they also believe that prices should remain relatively stable and should not increase significantly in the weeks ahead.

Analysts say the aforementioned rise of 3.4p in average prices to £1.05 per litre is a consequence of the global oil price rising to £28 a barrel for the first time since late last year.

For British motorists this equates to an average added cost of £1.84 for filling up a 55-litre unleaded tank on a standard vehicle.

The RAC stated: “The good times for motorists enjoying lower fuel prices had to come to an end at some point, but unfortunately it’s happened with a bit more of a bump than motorists were probably expecting. It looks as though we are heading towards a new norm of the oil price fluctuating between lower and upper limits of $35 and $55 a barrel.”

“This means that motorists should hopefully not see the eye-watering prices they were paying at the pumps in April 2012 when the average price of petrol was 142p and diesel was close to 150p per litre.”

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Companies see benefits of virtual offices

Elliot

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30 March 2016

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Companies see benefits of virtual offices

The Benefits of a Virtual Office

Making your office virtual sounds more complicated than it needs to be. With the rise of innovations such as cloud computing and virtual meetings, the degree of flexibility businesses have to play with nowadays is great for both productivity and staff morale. This post takes a look at the benefits.

Your Commute Will Be Non-Existent

Meetings become easier as no one will miss their public transport or be held up in traffic. Expenses for travel will be eradicated. London is named as the place with the longest commute in the country, with round trips to and from work totalling on average 74 minutes each way. Long commuting time builds up through the week equating to an awful lot of wasted time. Not everyone has the ability to carry out work on their commute, unfortunately.

Problem Solving

Keeping meetings to video or voice conferencing can mean earlier meetings, less stressed colleagues and more time to carry out other activities. Companies like Landmark Plc offer meeting spaces to act as your virtual office if you usually work from home but need meeting space. An excellent way of saving your business money.

Flexible Working Keeps Employees Happy

Achieving a work-life balance in this day and age is a subject of much contention. With Sweden announcing its 6-hour work day, and the constant questioning of the UK’s long working week, more employers are looking to make contracts flexible for the benefit of employees.

Cheaper Overheads

Additionally, the result of not having a set office means businesses can seriously cut down on overheads; heating, lighting, space rental, and appliance costs can be seriously reduced, if not wiped out completely, depending on the degree of flexibility that is offered.

Good Morale = More Productivity

The Swedish example has proven that more flexibility in the workplace actually increases the output of businesses. Flexibility can really promote morale as people have reduced levels of stress. Having dependents in the family takes up a lot of energy and people are increasingly not finding the time to have a life outside of the office. The rise in stress causes the need for more sick days, creating a negative impact on business figures. Put simply, happier staff mean better companies.

With a greater degree of flexibility in the structure of your day to day work, your business can go worldwide, allowing you to access more remote talent and save significant amounts of money to invest in the business’s growth.

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UK savers withdraw large sums from retirement funds

News

Elliot

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29 March 2016

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UK savers withdraw large sums from retirement funds

Following pension reforms in 2015 British savers have withdrawn significant sums from retirement funds, though not as high as some analysts predicted, according to figures released by the Association of British Insurers (ABI) as reported by the Guardian newspaper.

According to the report UK savers have taken out nearly £6bn from retirement funds since the introduction of pension reforms introduced by George Osborne last year. Osborne’s changes took away the requirement to convert pension pots into annuities – which in theory provide an income for life – and gave people the choice of what they wished to do with their retirement funds.

The new figures show that more than 213,000 lump sums totalling £3bn have been made to over-55s following the implementation of the changes last April. Retirees also have the added expense of rising funeral costs. In addition pension firms have paid out £2.9bn in regular sums to provide income.

Speaking on behalf of the Association of British Insurers their director of policy for long-term savings Yvonne Braun stated, “Following some initial pent-up demand, the number of people accessing their pension pot as cash in one go has settled down. People are taking a sensible approach and considering how they will pay for their whole retirement.”

The total number of over-55s taking out lump sums from their pensions since the regulation changes is below the figure predicted by many analysts who initially believed more than £6bn would be taken out in the first four months alone.

The Guardian reported, ‘The figures show that around £660m was paid out in cash lump sums during the final three months of 2015. This is well down on the £1.3bn withdrawn during the three months to 30 June, and the £1.2bn taken out in the period 1 July to 30 September.’

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Ofsted school results have direct impact on local property market

Elliot

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23 March 2016

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Ofsted school results have direct impact on local property market

A good Ofsted result for a primary school boosts local house prices by up to 1.5% – an average of £4,500 at current prices, new research suggests.

The results showed parents really are willing to move to a new area to improve their chances of getting the kids into a good school.

The study of 8,000 schools in England found that just a single point increase from ‘good’ to ‘excellent’ can inflate property prices by an average of 0.5%.

But in more affluent areas this increase rockets to as much as 1.5%.

However, a drop in Ofsted ratings can also lead to a fall in house prices by the same amount.

Each year, parents scramble to get their kids into the best schools, sometimes moving house if they can afford to do so.

Parents applying for primary schools are currently on tenterhooks, waiting for the results of their application to come in on April 16.

The research, conducted by the University of Sussex, was presented at the Royal Economic Society’s annual conference.

But the study also found that Ofsted result changes had almost no effect on house prices in less affluent areas.

Author Dr Iftikhar Hussain, from the University of Sussex, said: “People seem to be using Ofsted results as a quick and easy proxy for the quality of a school, whereas they find it much harder to fathom changes in a school’s SATS results.

“The fact there is any market reaction at all to an Ofsted score is extremely interesting, given that changes in inspection ratings are signals of short-term innovations in quality, which may be reversed in the next inspection round.

“What’s clear from the results is that richer households are more willing and able to pay for higher quality schools.”

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Britain is set for an influx of Iranian multi-millionaires looking to buy posh property following the lifting of international sanctions.

Sam Allcock

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21 March 2016

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Britain is set for an influx of Iranian multi-millionaires looking to buy posh property following the lifting of international sanctions.

Estimates say since the change in global relations, private and state-backed Iranians are preparing to embark on a £6 billion spending spree on homes around world.

And one estate agent expects Britain to get a large share of the 32,000 nationals who boast a fortune in excess of £2 million.

Most buyers will look to spend between £1 million and £30 million on a home in the capital, with the top locations for purchase being Knightsbridge, Mayfair, South Kensington, Hampstead and St John’s Wood.

Becky Fatemi, managing director of Rokstone estate agents, was born in Iran and her family worked for the Shah before the revolution in 1979.

She said: “London will be Iranian’s top location for investing in real estate. Culturally if you are wealthy in Iran you invest in property and jewellery/gold as long term assets.

“Historically there are deep ties between the UK and Iran. Britain was the colonial power in Iran and it was British firms that first exploited Iran¹s oil reserves.

“Between 1945 and 1979 the Shah of Iran, his Royal court and the business elite had lots of ties with Britain and the elite owned luxury residential property in London and the home counties.”

Rokstone calculates around 1,000 to 1,500 families or companies will be investing in property over the next three to five years, with up to 50 of these having the finances to spend up to £100 million each on overseas investments.

The cash will come from private individuals/families, professional investors, private companies and quasi-state backed entities or sovereign wealth funds, according to Rokstone.

London is expected to be one of the top locations because of the sizeable Iranian expat community.

It is estimated there are currently 80,000 exiles in London, who when the Shah and Queen Farah fell from power.

Ms Fatemi added: “Alternative locations have less appeal. Historically, rich Iranians also invested in New York and Los Angeles, but US government primary sanctions remain in place so these choices are not available.

“Dubai on the doorstep will also be popular but it cannot compete with London’s educational system or cool summer climate.

“The other historic ties are with Germany, Paris, the French Riviera and Switzerland but London is safer than these since a lot of properties in the capital are in conservation areas where building alterations are restricted so values hold and outperform continental Europe.”

A veteran VAT inspector narrowly avoided prison after pocketing £1.2million from a property empire – while running a tax scam.

Tax

Sam Allcock

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21 March 2016

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A veteran VAT inspector narrowly avoided prison after pocketing £1.2million from a property empire – while running a tax scam.

Buy-to-let baron Savita Seth, who was a VAT inspector for 20 years, deceived the taxman and mortgage lenders for 17 years alongside her husband Naveen.

Savita sobbed and said “bless you” as the judge at Isleworth Crown Court suspended her two-year prison sentence despite jailing Naveen for three years and eight months.

The pair, both 47 and from Uxbridge, north west London, rented out 12 properties earning £1.2m and paid £500,000 into their bank accounts.

The properties were split into bedsits to maximise profits and they also swindled £63,983 in tax credits.

Judge Nicholas Wood said: “I have considered whether the Crown’s argument on culpability because you abused your position of power, trust or responsibility in regards to your employment.

“Although you were working in HMRC you didn’t use the particular knowledge or inside skill in order to further this offence.

“I’ve listened to various points in particular your good character, your own health problems, your role as a carer for two generations of the family and in particular health problems and behavioural problems of your youngest son.

“I take the view this is very much a borderline case but in the circumstances I feel able to suspend the sentences of imprisonment.”

Mum-of-two Savita sobbed as she was let out of the dock, and said: “Thank you so much. I bless you.”

The court also heard how her father-in-law has dementia and she would have to act as carer to her own parents as well as her husband’s now that he is in jail.

The judge also declined to impose a curfew order or hand her any hours of unpaid work.

He said: “Rather bluntly you have an awful lot on your plate for the foreseeable future considering I sent your husband to prison on Friday.

“Giving you unpaid work would be setting you up to fail.”

During the scam the couple rented out three bedsits at their home plus parking spaces in their drive – and planned to expand their portfolio to the US.

Police found the book A Guide To Becoming A HMO (Homes of Multiple Occupation) Millionaire during a raid on their house and discovered they also had a villa in Spain, an apartment in Florida and a seaside caravan.

The pair had two commercial properties, bought for £135,000 and £111,000 cash, while Naveen had no obvious income and Savita was a £20,000-a-year civil servant with HMRC.

Judge Wood said while jailing her husband: “This was fraudulent activity conducted over a sustained period of time.

“In terms of the tax credits you had no right to be claiming them right from the beginning.

“You have however considerable mitigation, positive good character references, and I take this all into account.

“They enable me to reduce the aggregate figure I would otherwise have passed from the region of five years to one of three years and eight months.”

Last month the couple were convicted of fraudulently obtaining mortgages on two properties in Hillingdon and Colindale and failing to declare their rental income between 1995 and 2012.

They also fraudulently gained £63,983 in Job Seeker’s Allowance over many years which Naveen would “never have been eligible for” if he had been honest about his finances.

Additionally they were convicted of concealing profits made from capital gains, avoiding a tax bill of £90,000 while Naveen was also found guilty of forging a lawyer’s letter and Savita of wrongfully disclosing information.

The letter, made out in the name of a Harrow lawyer, was in relation to a property the Seths planned to buy in America.

Previously prosecutor Ailsa Williamson said: “They lied about their incomes. They rented out most of the properties and got income but never told the tax man about it.

“They sold three of the properties but did not declare their profit.

“The icing on the cake was tax credits they claimed by lying about their income.”

The Seths falsely inflated their incomes to banks and building societies to two obtain mortgages on properties in Colindale and Hillingdon, while Naveen represented himself as a high-earning IT consultant even when claiming Jobseeker’s Allowance.

Miss Williamson said: “Some of the lies were blatant as he was made redundant in 2002. What is galling is Savita was working for HMRC as a tax compliance officer specialising in VAT.”

Miss Williamson said the couple had not declared rental income for “many years” from 1996 onwards.

She said: “In relation to Savita, the Crown would also point to abuse of power, trust or responsibility.

“It was her position by which the Crown say she must have been aware of her need to have her tax affairs completely above board, and her failure to do so over a sustained period is a breach of this trust and responsibility imposed on HMRC officers.”

Besides their eight-bedroom home the couple bought properties in Docklands, Hayes, Uxbridge, Harrow, Hillingdon, Colindale and Bracknell.

The two commercial buildings – a restaurant and takeaway with flats – were in Cumbria and Bingley, West Yorkshire.

The couple were cleared of falsely obtaining mortgages for their portfolio except for the Colindale and Hillingdon properties.

The Seths, of 7 Manor Way, Uxbridge, will later face a confiscation hearing.