Fuck, so much for bloody self learning code.
Ahhhh, the Chumpy Gambit.
Balshore had sold its shares by 2018 for an estimated £27m.
On Friday, the Guardian newspaper reported he had agreed to pay a penalty as part of a seven-figure settlement. The newspaper quoted experts saying they estimated the tax bill to be about £5m.
The BBC has been told the total amount paid was close to sums that have been reported elsewhere, in other words, about £5m.
The BBC understands the dispute was resolved between July and September last year, when Mr Zahawi was chancellor under Boris Johnson, and that the total amount paid is in the region of about £5m, including a penalty.
Don’t get this, if he sold the shares for £27million he would owe £5.4million in CGT, plus the 30% penalty that would be £7million
Had he simply subscribed for the shares himself, there may have been quite some reliefs available - there’s a lot available for entrepreneurs. They might be comparing to that?
Don’t you pay CGT on the gain in value ? Maybe the shares were created, or at least transferred into the trust, with some nominal value - say £8million. Then the gain would be £19million, the tax £3.8million and the penalty a tad under £1.2million.
Nominal value of 0.2p
If he had 42.5% of the shares (I’ll use 40%) that would value them as £120,000
Once you are in these rarified heights of income you don’t pay a calculated rate, you negotiate a settlement with HMRC
As was reported previously, “A settlement was agreed with HMRC”.
Indeed which is why the pound shop accountancy above is irrelevant
As opposed to the utter wank you posted above?
WTF are you talking about?
Multi millionaires have their own rules and HMRC treat them very differently to the rest of us plebs.
ok, I bow to your infinite wisdom on these matters
He would have qualified for Entrepreneur’s Relief - first £10m of gain taxed at 10% back in 2018.
Now called Business Asset Disposal Relief and first £1m at 10%.
If he hadn’t dicked about with the trust and owned the shares 50-50 with his wife he could have paid 10% on £20m. Assuming he is married, I have no idea TBH.
I think you might have had to have been a full time working director to get that, so it wasn’t a wife friendly thing, generally.
But if he didn’t claim any entrepreneur reliefs then he shouldn’t get them, IMO. Should have paid tax on the whole lot.
The contractors favourite, MVL with entrepreneurs relief
His shares were held by a trust and they would both have to claim ER at the same time which is what I think Adam is also saying. The application window closed for 2018 disposals in Jan 2021 so if he corrected/sorted/negotiated his “careless mistake” last year he had missed the window to apply for ER anyway.
Full details are here including the tax estimation
No need to be a director and no minimum hours requirement for ER. Only a 12m qualification period back then as well.
Take your point on the claim, maybe he didn’t get it. Dan Niedle has worked on the basis he did get ER.
Fair enough, I’m 20 years out of date with this kind of stuff!
Interesting to learn that Balshore Investments doesn’t feature at all in the register of member’s interests for Zahawi. That’s going to take some explaining.