A last-minute rush to accelerate the payment of bonuses ahead of April's introduction of the 50p tax rate for high earners is under way, amid mounting anger by top executives over the squeeze on their take-home pay.
According to The Financial Times, advisers said there had been a surge in interest since new year from businesses wanting to shift the timing of payments or introduce tax-efficient plans to avoid the new top tax rate.
A similar drive has prompted bigger or accelerated dividend payments by companies where directors own substantial chunks of equity. Hargreaves Lansdown, HomeServe, Pennon Group and Beazley made such moves this month.
Chris Page, head of employee incentives at KPMG, the professional services group, said finance directors were being "harangued" by colleagues seeking to mitigate the rising tax bill. "There is a lot of pressure from senior people saying they will be seriously impinged if nothing is done. It is now getting very uncomfortable". Full story...
THE cold wind of public disapproval appeared to have touched the hearts of Britain's wealthiest bankers yesterday when the chairman of the Royal Bank of Scotland agreed to go without his £1.6m bonus.
Stephen Hester's friends were quick to say that the RBS chief executive had every right to expect to be rewarded for his work in turning the bank around, after being hired in November 2008 to sort out the mess left behind by the previous board, reports The Independent.
He had renounced his bonus only to avoid the risk of the bank being embroiled in political controversy again.
"This is all about de-politicisation," one said. "He is aware of the public's feelings about banks and felt that to increase the hostility towards RBS would be counter-productive." Full story...
NORTHERN Rock could take over branches from Royal Bank of Scotland (RBS) and Lloyds that the two groups have been forced to put up for sale, according to The Times.
The idea has been floated in government and banking circles. The management of Northern Rock is understood to favour the move as a way of reinvigorating its brand and establishing a significant new force on the high street.
Northern Rock was split into a "good" bank and a "bad" bank on January 1 as part of the Government's plan to return both parts to the private sector over time.
The Treasury has abandoned plans to try to sell the good part, which includes £19.4bn in deposits, £10.4bn in mortgages and £8bn in cash, before the general election. Instead, it is considering ways to generate value over the longer term. Full story...
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