{"id":8651,"date":"2023-01-15T11:31:31","date_gmt":"2023-01-15T11:31:31","guid":{"rendered":"https:\/\/www.taxpolicy.org.uk\/?p=8651"},"modified":"2023-01-26T17:33:11","modified_gmt":"2023-01-26T17:33:11","slug":"zahawi_pay_up","status":"publish","type":"post","link":"https:\/\/heacham.neidles.com\/2023\/01\/15\/zahawi_pay_up\/","title":{"rendered":"Did Nadhim Zahawi pay up to avoid an HMRC enquiry over YouGov?"},"content":{"rendered":"\n

That’s the obvious inference of this astonishing story<\/a> in today’s Sun. On the face of it, this confirms my investigation in July<\/a> that concluded Zahawi had avoided around \u00a34m in tax by arranging for his founder shares in YouGov to be held by a subsidiary of his father’s offshore trust. <\/p>\n\n\n\n

Zahawi denies the Sun’s story, but in a curiously specific way: he “never had to instruct any lawyers to deal with HMRC on his behalf”.<\/p>\n\n\n\n

If the Sun is right, what would have happened?<\/p>\n\n\n\n

It’s reasonably clear there wasn’t a pre-existing enquiry into YouGov – Zahawi explicitly denied this and (more convincingly) around the same time I received confirmation from HMRC (in response to an FOIA request) that no ministers were under enquiry.<\/p>\n\n\n\n

So I would speculate that, when my investigation broke in July, Zahawi instructed accountants to look into his old YouGov structure. They told him that he was bang to rights; he then made a disclosure to HMRC with the aim of making swift payment in full to avoid an enquiry. If so, that might help explain the apparent speed with which a settlement was reached. Typically an HMRC enquiry involving a large amount involves years of negotiation, and HMRC has strict governance processes that they must comply with. I had expected HMRC would respond to my story by starting an investigation, and then by opening an enquiry around the end of 2022 – but if Zahawi had convincingly paid up in full by then, no enquiry would ever be opened.<\/p>\n\n\n\n

That is, however, just speculation. The payment could relate to some other matter – perhaps the mysterious NCA\/HMRC investigation which was reported by the Independent<\/a>, which (according to the Guardian<\/a>) caused a “red flag” to be raised when Zahawi was appointed Chancellor. Zahawi denied this – but it was always a meaningless denial, because there’s no reason he would know he was under investigation. It was telling that the Cabinet Office, who could convincingly deny the “red flag” story, did not do so.<\/p>\n\n\n\n

Or the Sun could be wrong. That feels unlikely – it’s a big risk for them to run the story unless they were sure. I’ll keep an open mind – let’s see if we get any more convincing denials out of Mr Zahawi.<\/p>\n\n\n\n

UPDATE: new story from the Independent<\/a>, with the interesting addition that Zahawi’s spokespeople don’t seem to be denying the story. T<\/strong>hey just repeat his usual boilerplate about his taxes being properly declared and paid. That rather begs the question of whether they’re only properly declared and paid because he approached HMRC to disclose a previous under-payment of tax)<\/strong><\/p>\n\n\n\n

So what’s going on? If this was a boring ordinary course self assessment payment of tax then presumably Zahawi would say so?<\/strong><\/p>\n\n\n\n

And if it wasn’t\u2026 what was it?<\/strong><\/p>\n\n\n\n

<\/p>\n\n\n\n

More to follow.<\/p>\n\n\n\n

<\/p>\n\n\n\n

<\/div>\n\n\n\n
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Comment policy<\/h2>\n\n\n

This website has benefited from some amazingly insightful comments, some of which have materially advanced our work. Comments are open, but we are really looking for comments which advance the debate – e.g. by specific criticisms, additions, or comments on the article (particularly technical tax comments, or comments from people with practical experience in the area). I love reading emails thanking us for our work, but I will delete those when they’re comments – just so people can clearly see the more technical comments. I will also delete comments which are political in nature. <\/p>\n\n\n\n\n","protected":false},"excerpt":{"rendered":"

That’s the obvious inference of this astonishing story in today’s Sun. On the face of it, this confirms my investigation in July that concluded Zahawi had avoided around \u00a34m in tax by arranging for his founder shares in YouGov to be held by a subsidiary of his father’s offshore trust. Zahawi denies the Sun’s story, […]<\/p>\n","protected":false},"author":1,"featured_media":8652,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[141],"tags":[128],"jetpack_featured_media_url":"https:\/\/heacham.neidles.com\/wp-content\/uploads\/2023\/01\/gQDoNIyp.jpg","_links":{"self":[{"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/posts\/8651"}],"collection":[{"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/comments?post=8651"}],"version-history":[{"count":10,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/posts\/8651\/revisions"}],"predecessor-version":[{"id":8826,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/posts\/8651\/revisions\/8826"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/media\/8652"}],"wp:attachment":[{"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/media?parent=8651"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/categories?post=8651"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/heacham.neidles.com\/wp-json\/wp\/v2\/tags?post=8651"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}