Forths Joins Frenkel Topping Group
July 23, 2020
We are delighted to announce that Forths Forensic Accountants is now part of the Frenkel Topping Group.
Our businesses have had a strong working relationship for many years, share similar cultures and have a real focus on service delivery and client retention.
We are committed to delivering market leading expert services in relation to in all types of personal injury and clinical negligence cases, commercial disputes, criminal litigation and tax investigations.
As we are now part of a larger business, this will extend our offering to clients (both in terms of pre and post settlement services in the context of personal injury and clinical negligence cases), and allow access to a wider network of independent experts.
We are looking forward to continuing to develop our relationships with both solicitors and insurers and delivering the enhanced offering that this exciting move now brings.
Recent tax changes announced by Chancellor Jeremy Hunt may mean that any future loss calculations may require review. If you have an ongoing case that we have assisted with, we would be happy to discuss this with you. Likewise, for any potential new instructions we are always happy to have an initial chat. National Insurance Cuts On 6th January 2024 cuts to National Insurance rates will come into effect for employed Claimants: The main NI rate is being cut from 12% to 10%. From April 2024 for self employed Claimants: Class 4 NI rate will reduce from 9% to 8%, and; Class 2 NI contributions will be scrapped. The changes will affect future Loss of Earnings calculations. State Pension Changes There will also be a rise in State Pension of 8.5% from April 2024. Losses to State Pension are considered on a case by case basis. How We Can Assist Our experienced team assist with Loss of Earnings, Pension Loss and Loss of Dependency elements in all types of PI, Clinical Negligence and Fatal cases. Our approach is to ensure that your client’s Special Damages are optimised. We offer flexible solutions and reporting styles depending on the case requirements, and can assist you in the information discovery process. We are also happy to liaise directly with clients to assist in the progress of the case. For more information about our hourly rates for Expert CPR or White Label / Agency Services, and deferred payment terms, talk to our team. Contact us here Call us on 0113 387 5670 Email - enquiries@forthsonline.co.uk
Here at Forths Forensic Accountants we are continually reviewing information and guidance in relation to the coronavirus pandemic. Our focus has been on ensuring that we have robust business continuity strategies in places to continue to service the needs of our clients, whilst heeding advice from experts and government to ensure the safety of clients, staff and the general public. To this end we have developed stress tested and comprehensive home working contingencies for staff as required. Throughout this difficult period our team will still be on hand to provide our normal level of service, and should you need to contact us for any reason, please do not hesitate. If there is anything case specific, or generally, that you would like to discuss with us, please: Call us on 0808 169 9090 Email us at enquiries@forthsonline.co.uk Fill out a Contact Form Finally, we would like to send our best wishes in this challenging time. The Forths Team
Here at Forths, we are continually developing our depth of technical forensic accounting expertise in relation to all aspects of personal injury disputes. One such area is the incidence of taxation in different jurisdictions. Over the years we have developed a significant specialism in cases involving Jersey based Claimants, who have been involved in accidents and who are seeking to pursue claims for lost income / earnings arising therefrom. Our knowledge of the complexities and particular nuances of the Jersey Tax system, coupled with the enactment of the Damages (Jersey) Law 2019, enables us to be well placed to prepare accurate assessments of a Claimants’ net losses for use in proceedings. Case Study Example One such example is of a case in which the Claimant worked as a self employed architect, via her own Limited Company, whose involvement in a road traffic accident in Jersey had seriously disrupted the growth and expansion of her business. The Claimant had remunerated herself by way of director’s salary, pension contributions and dividend income, which necessitated an assessment of the company’s projected net profit after Corporation Tax, but for the accident, and subsequently a calculation of the Claimant’s projected net income, after Tax and Long Term Care Contributions (‘LTCC’). We also have experience of calculating personal Tax at the marginal rate, after allowing for various reliefs, including second earner’s relief, under Jersey’s fiscal system. In other Personal Injury cases with unusual features, we have undertaken work for English lawyers on road traffic accident claims involving British nationals which were being pursued overseas. In these cases we liaised with the solicitors’ appointed German and Maltese advocates, to formulate the dependency loss and past and future loss of net earnings claims, respectively, in accordance with the relevant judicial protocol. We are also fully au fait with the workings of the Scottish Tax and judicial system, undertaking a considerable amount of work for Claimants North of the border. To discuss a case involving aspects outside of UK jurisdiction, talk to our team. We will ensure that the claim is accurately quantified and correctly presented to the Courts. We are always happy to utilise our existing skill set to investigate and report upon new matters. To discuss a case on a no obligation basis, call us on 0113 387 5670, email us at enquiries@forthsonline.co.uk or fill out an Enquiry Form
Self Employed Loss of Net Income If your Claimant works on a self employed basis and has suffered a period of absence and / or restricted capacity, then they will have potentially suffered a loss of net profit, and a subsequent loss of net income. A Claimant’s loss of net profit can arise from a loss of sales, or when additional costs have been incurred (e.g. additional wages costs as a result of employing someone to cover their workload during the affected period), or when the Claimant has had to change the nature of their work which is less profitable. When your Claimant works on a self employed basis, the loss of net income calculation can be more complex when compared to a Claimant working on an employed basis, as their pre accident / negligence trading patterns need to be considered, market conditions and the availability of work during the affected period, as well any savings made in costs that would have been incurred had the Claimant been able to continue working as normal. Partnerships and Limited Companies In addition to trading on a sole trader basis, the loss of net income calculation can be more complex if your Claimant trades via a Partnership or a Limited Company. A Claimant is entitled to claim for their share of the Partnership’s / Limited Company’s loss of net profit, based on their percentage holding in the Partnership / percentage shareholding in the Limited Company. It is not uncommon for a Claimant’s relation (e.g. wife / husband) to also have a shareholding in the Limited Company or percentage holding in the Partnership despite having no active role within the business, rather it is for tax planning purposes only. In some instances, it is possible to assess the Claimant’s economic input into business to assess their share of the loss of net profit, rather than their strict shareholding. RECENT EXAMPLE: The Claimant was involved in an accident, he traded via a Limited Company, undertaking work in the telecommunications industry, predominately in Fibre Optics. Following his involvement in the accident, whilst he incurred various periods of absence, he was able to return to work, but suffered on ongoing loss as he was unable to undertake work at a height and had to change the nature of his work, which was ultimately less profitable than his pre accident work. The Claimant held 100% of the shares in his Limited Company, and so was entitled to claim 100% of the company’s loss of net profit arising due to the accident. The Claimant’s loss of net income was calculated after taking account of Corporation Tax, as well as Income Tax and National Insurance Contributions. In complex scenarios such as these, we can assist. We provide both Expert CPR and White Label (Agency) Services. We are happy to assist in gathering the relevant financial information in order to assess the Claimant’s losses. The earlier involvement in your case allows us to ensure that all relevant information is obtained in a timely manner. To discuss your case on a no obligation basis: Call us on 0113 387 5670 Email us at enquiries@forthsonline.co.uk Fill out an Enquiry Form and we will call you back
Please note that the office will be closed from 2pm on Friday 13th December for our office party. Monday 23rd Dec – 9am to 5.30pm Tuesday 24th Dec – 9am to 4pm Friday 27th Dec – 9am to 4pm Monday 30th Dec – 9am to 5.30pm Tuesday 31st Dec – 9am to 4pm Thursday 2nd Jan – 9am to 5.30pm Friday 3rd Jan – 9am to 5.30pm
In fatal accident cases, Claimants will usually suffer a loss of dependency on the Deceased’s income, earnings and/or pension benefits. This is still the case if the Claimant’s income was similar to the Deceased’s income (and in fact, there will be a loss of dependency unless the Claimant’s income would have been more than double the Deceased’s income, in cases with one financial dependent). To calculate the loss of financial dependency, the Deceased’s and Claimant’s projected net income should be calculated throughout the period of loss. This will take into account all earnings, income and pension benefits that the Deceased and Claimant would have received, but for death. No credit needs to be given for changes to the Claimant’s actual income as a result of death (for example, increasing hours to cover living expenses). While projected employed earnings may be straightforward to calculate, cases including individuals aiming for promotions, self-employment, trading via limited companies, or workplace pension schemes can be more complex. Loss of Dependency Example: The husband was involved in a fatal accident, and he ran his own limited company. His wife worked as a teaching assistant. Although the Claimant didn’t work in the company, she received a salary and dividends from the company for tax planning purposes, in addition to her salary as a teaching assistant, so their annual net income was similar. However, as the company ceased trading after the accident, using the argument set out in case law such as Ward v Newalls , the losses were calculated based on all dividends being attributable to the husband. The Claimant increased her hours of work following her husband’s death, in order to cover her living expenses. However, no credit needs to be given for these extra earnings. Based on this, the husband’s projected net income was calculated as £67,000 per annum, despite his pre-death net income, per his Tax Returns, being £40,000 per annum. Similarly, the wife’s projected net income was calculated as £9,000 per annum, despite her pre-accident income being £40,000 per annum. Therefore, despite the Tax Returns showing very similar pre-death income, the loss of dependency on earnings was calculated as £41,667 per annum ((£67,000 + £9,000) x 662/3% - £9,000). To discuss a potential case: Call us on 0113 387 5670 Email us at enquiries@forthsonline.co.uk Fill out an Enquiry Form
Employed Claimant Pension Loss Example Almost all the UK’s employed workforce will now be a member of their employer’s workplace pension scheme. Therefore, if your Claimant is employed and has suffered a loss of earnings (even if this is only a past loss of earnings), then consideration needs to be given for a corresponding pension loss. Every relevant employee now has to pay a minimum of 5% of their qualifying earnings into their workplace pension, with their employer paying 3%, giving 8% in total. For example, if an employee has suffered a past loss of earnings of £10,000pa (gross), they could have a corresponding pension loss of £800 (8% of £10,000). However, in reality, the pension loss calculation is much more complex than this. It is dependent upon the type of scheme the employer offers and what they deem as qualifying earnings. Indeed, some employers still offer a more lucrative Final Salary or CARE pension scheme (e.g. NHS, Civil Service, Police, Fire Service, Armed Forces, Teachers, Royal Mail), which would give a much higher value pension loss than that estimated in the above calculation. To discuss a potential case, contact us on 0113 387 5670, email enquiries@forthsonline.co.uk or fill out a Contact Form . Fatal Accident / Lost Years Pension Claims In fatal accident and lost years claims, do not forget to consider a loss of dependency or lost years on State Pension, in addition to any private or workplace pensions, whether this be for an employed or self-employed individual. For example: The husband was involved in a fatal accident, he was a self-employed Electrician. His wife was a self-employed Beautician. They were of a similar age and had no private pension provisions Her annual loss of dependency on his State Pension from retirement would be £2,921pa, calculated as follows: £8,767 [His State Pension] + £8,767 [Her State Pension] x 66.66% - £8,767 [Her State Pension] We offer both Expert CPR and White Label / Agency Services to assist in quantifying your client’s financial loss, either in consideration of both earnings and pension loss, or on a standalone basis. Call us on 0113 387 5670 Email us at enquiries@forthsonline.co.uk Or fill out a Contact Form and we will be in touch
On 6th December 2018 the Lord Chancellor presented a call for evidence around the setting of the Personal Injury Discount Rate, pursuant to the enactment of the Civil Liability Act 2018. In the Civil Liability Act, important changes were made to the way that the Discount Rate, prescribed by the Lord Chancellor, would be set. Specifically, these changes were intended to ensure that the Discount Rate reflects the return that, in the opinion of the Lord Chancellor, a Personal Injury Claimant could reasonably be expected to receive from investing a lump sum award of damages for future loss in a diversified low risk portfolio. This differs from the previous basis of assessment, whereby the Discount Rate was set with reference to very low risk investments. On the basis of this call for evidence, on Monday, the Lord Chancellor revised the Discount Rate from -0.75% to -0.25%, a rate which will come into force on 5th August 2019 and remain for a period of up to 5 years. It is likely that the new Discount Rate will be relatively well received by the Claimant community whilst the Defendant community will be disappointed, in that the rate represents the lowest end of their range of expectations. So what does this mean? The Discount Rate change will impact on the value of claims where there are elements of future loss to the Claimant. In a practical and general sense, claims for future loss will decrease based on the revised Discount Rate. How can we assist? If you already have instructed us on a case, please contact us if you wish our report / calculations to be updated for the revised Discount Rate. We assist in quantifying complex special damages elements in all types of PI and clinical negligence cases, including where there is a future loss. We are regularly instructed to assist in calculating loss of earnings, pension loss and dependency claims, either on an Agency or Expert basis. To discuss a case on a no obligation basis, call us on 0113 387 5670, email us at enquiries@forthsonline.co.uk or fill out an Enquiry Form .
The events in the recent criminal carbon credits fraud trial, in which the main prosecution Expert Witness was found to have no academic qualifications and had not even read a book on the subject he purported to be an expert in, have unfortunately resulted in unwarranted negative publicity for Experts as a whole. Regardless of the obvious questions around the due diligence that the CPS adopted in selecting their Expert, the fact is that the Expert in this instance, was not what he held himself out to be and that had huge ramifications for both the specific trial in question and, in all probability, historic trials that he has been involved in. In terms of the wider ramifications for other Experts, this will no doubt lead to a greater critical examination of credibility type issues, particularly in trials, for Experts on both sides of the fence and it is important, therefore, that credibility is established at the date of instruction. So what makes an Expert expert in the context of legal proceedings? At Forths, we believe that there are 3 main elements; professional qualifications, experience and an understanding of duty to the Court. Professional qualifications are vital in that they provide the academic and, importantly, ethical framework which is the foundation on which specific experience and knowledge of the Court system are built to create a rounded and effective expert with the integrity to avoid cutting corners and partisan behaviours. With Forths, you can be assured that all of our signatory Experts are fully qualified accountants with many years full time experience in the Forensic Accountancy field and are au fait with all of their duties under the relevant procedure rules. We are renowned for our robust and well reasoned opinions and for reports that clarify and simplify complex issues. As has been shown by recent events, occasionally all may not be as it seems but you can trust in us and know that our Experts are true experts in the work they undertake. To discuss a potential case under no obligation, contact us here .
On March 19th, 2019, David Gauke, the Lord Chancellor and Justice Minister, began the Government’s review into the personal injury discount rate. The results of the review, which has a strict 140-day window for completion, are expected to be published on 5th August. What is the personal injury discount rate? The payment received by a claimant who has been the victim of either a personal injury or clinical negligence is adjusted by a factor called the “personal injury discount rate”. Lump sum payments (or periodic payments if applicable) made to claimants are calculated on the basis of future ongoing annual losses a claimant will experience (the “multiplicand”) and another amount ascertained by referring to the personal injury discount rate (the “multiplier”). The “multiplicand” and “multiplier” are then multiplied by each other and the result of this calculation is the current value of the eventual loss over the lifetime of a claimant who invests that lump sum in a “risk adverse” way over the remainder of their lifetime. The discount rate is calculated against the returns made on index-linked Government security following the ruling in the Wells vs Wells [1999] 1 AC 345 case that claimants should be treated as ordinary investors who sought certainty and security in their investment approach – a “very low risk” approach. Why is the personal injury discount rate being reviewed? When the discount rate was first set in 2001, it was set at a rate of 2.5%. The return on index-linked government investments plummeted following the financial crisis around a decade ago, eventually leading to a change in the discount rate to -0.75% on 20th March 2017. The new discount rate represented a shift from a “very low risk” investment strategy to a “low risk” investment strategy. As a result, this change in the personal injury discount rate has led higher than previously awarded levels of compensation for claimants. A 25-year old with a life expectancy of 70 would receive 51.33 times the lump sum with a discount rate of -0.75% as opposed to 26.4 times the lump sum with a discount rate of 2.5%. The change in approach has not been without controversy. Liz Truss, the Lord Chancellor at the time, announcing the new policy, was praised by claimants for the move however defendant insurers called for a meeting with Philip Hammond, the chancellor, within 24 hours to ask the Government to change its mind. At the time, very few expected the discount rate to be set at a negative figure and this change, insurers contend, means that insurance premiums have been pushed up for businesses and consumers as a result of having to pay much higher lump sums to personal injury or clinical negligence claimants Opposing views Speaking to ClaimsMag , Association of Personal Injury Lawyers president Brett Dixon said that “the needs of some catastrophically injured people are best served by a lump sum payment, others by instalments and still others by a combination of the two. If the government is determined to make changes to the discount rate, it is important to make sure we have a new way of using periodical payment orders at the same time.” He urged the government to place the needs of victims whose lives have been changed through no fault of their own as the highest priority. In welcoming the announcement of the review, James Dalton, director, general insurance policy, Association of British Insurers (ABI) told AOL that “Insurers remain committed to paying 100% compensation and want to see a process for setting the discount rate that delivers a fair outcome for claimants, motorists and taxpayers. The outcome of the review must deliver this, and we will continue to play our part to ensure that it does.” There is little doubt about the importance of the outcome of the personal injury discount rates review to both sides. As summed up by the Law Gazette , "the government will today set the ball rolling on potential changes to the personal injury discount rate - with insurers and claimants standing to lose or gain millions depending on fractional shifts". Forensic Accountants Our experienced team assist in all types of personal injury and clinical negligence cases ranging from thousands to multi million pounds in value. We have specialist expertise to assist in quantifying loss of earnings, loss of pension and dependency elements, particularly in cases with complex scenarios. For more information, or to discuss a potential case, call us on 0113 387 5670, email us at enquiries@forthsonline.co.uk or fill out an Enquiry Form and we will contact you directly.