Nick
Sommerlad writes:
Nigel Farage opened an
offshore trust fund in a plan to slash his tax bill, a Mirror investigation has revealed.
But he insisted he did not personally benefit from the trust fund he set up in a bid to save thousands of pounds in tax. And the UKIP leader even claimed he ended up out of pocket after opening the scheme on the Isle of Man.
But he insisted he did not personally benefit from the trust fund he set up in a bid to save thousands of pounds in tax. And the UKIP leader even claimed he ended up out of pocket after opening the scheme on the Isle of Man.
The 49-year-old paid a tax adviser to
create the Farage Family Educational Trust 1654 in the tax haven – which he
intended to channel funds through.
The outspoken anti-Europe politician confessed its existence during a string of meetings with our investigators. But the former City trader said: “My financial advisers recommended I did it, to have a trust really for inheritance purposes and I took the advice and I set it up.
The outspoken anti-Europe politician confessed its existence during a string of meetings with our investigators. But the former City trader said: “My financial advisers recommended I did it, to have a trust really for inheritance purposes and I took the advice and I set it up.
“It was a mistake. I was a completely
unsuitable person for it. I am not blaming them it was my fault. It’s a vehicle
that you chuck things in through your life that you don’t need and you build up
a trust fund for your children or grandchildren. It was called an educational
trust and could have been used for grandchildren’s schools fees, things like
that.
“It was a mistake for three reasons. Firstly,
I’m not rich enough to need one and I am never going to be. Secondly, frankly,
the world has changed. Things that we thought were absolutely fair practice 10
years, 20 years ago, 30 years ago aren’t any more. Thirdly, it was a mistake
because it cost me money. I sent a cheque off to set it up.”
Farage’s statements are even more
extraordinary as he criticised offshore tax havens – naming the Isle of Man –
in a speech in the European Parliament. Tax expert Richard Murphy, who studied
our dossier, said: “There are only two good reasons to set up an Isle of Man
trust. One is secrecy, you don’t want someone to know what is in there. The
other is tax avoidance. And sometimes, of course, they go together.”
Tax dodging costs Britain £35billion a
year, according to HM Revenue and Customs, but Tax Research experts say it is
as much as £123billion. David Cameron backed a landmark deal at the G8 summit
this week to crack down on corporate tax evasion.
The Mirror confronted Farage with financial documents as he campaigned for UKIP in Aberdeen. These revealed he transferred his shareholding in Farage Limited after it was founded in 2003 to the Farage Family Educational Trust, based in Douglas, capital of the Isle of Man.
The Mirror confronted Farage with financial documents as he campaigned for UKIP in Aberdeen. These revealed he transferred his shareholding in Farage Limited after it was founded in 2003 to the Farage Family Educational Trust, based in Douglas, capital of the Isle of Man.
This meant the trust owned a 33% stake
in Farage Limited, later rising to 50%. Quizzed about the Farage Family Educational
Trust, the politician insisted: “I was not a beneficiary.”
When we showed him a copy of Farage Limited accounts from 2004 indicating he owned shares in the city trading firm, he declared: “They are wrong then, aren’t they? I originally had the shares. I gave them away to the trust.” Asked who set up the trust, Farage replied: “I set it up on behalf of somebody else.”
When we showed him a copy of Farage Limited accounts from 2004 indicating he owned shares in the city trading firm, he declared: “They are wrong then, aren’t they? I originally had the shares. I gave them away to the trust.” Asked who set up the trust, Farage replied: “I set it up on behalf of somebody else.”
Pressed on who were the owners of the
trust, Farage added: “There are none. It is closed.” His brother Andrew, a
co-director who owned the other 50% of the company, pocketed £969,000 in
dividends from the firm. Farage initially refused to confirm his sibling’s
windfall.
Asked if the payouts went to Andrew, he replied: “They must have done.” And pushed on who received the £969,000, he said: “It’s a slightly unfair question because you are asking me to implicate someone else’s tax affairs in the Daily Mirror. It’s sensitive and the sums of money are quite big. You’re talking about nearly a million quid.
Asked if the payouts went to Andrew, he replied: “They must have done.” And pushed on who received the £969,000, he said: “It’s a slightly unfair question because you are asking me to implicate someone else’s tax affairs in the Daily Mirror. It’s sensitive and the sums of money are quite big. You’re talking about nearly a million quid.
“The accountant who set up the company
is prepared to speak to you. He will tell you on the record that I never
received any dividends at all from that company ever and it all went to one
individual. It’s not difficult to work out who it was.” Farage Limited’s
accountant Spencer Watson later confirmed that all £969,000 in dividends were
paid to Andrew.
When we contacted Farage’s 47-year-old
brother, he said: “I don’t want to make any comment. If I did, I did. If that’s
what I earned that’s what I earned. All my money was paid and tax was paid on
it in this country. Nigel had nothing to do with those monies. But if that’s
what my accountant is saying then that’s fine.”
Farage himself claimed he was “unpaid
during that period of time”. He added: “I packed up business completely in
2004.” But on his Declaration of Members’ Financial Interests for the European Parliament
dated January 2004, he stated that he was paid for being a director of Farage
Limited.
He was also company secretary of the firm. In every annual declaration from 2004 to 2009, Farage stated he was paid for “commodity broking”.
He was also company secretary of the firm. In every annual declaration from 2004 to 2009, Farage stated he was paid for “commodity broking”.
Farage Limited was his only company
appointment posted at Companies House. He later gave the Mirror a longer interview at the Kent home he shares with
German-born wife Kirsten.
After inviting us into his kitchen, Farage was asked why he told EU officials he was paid for “commodity broking”, as he had said to our reporter he gave up business in 2004.
He replied: “Just to be careful, purely caution. I was over-declaring. I didn’t need to do it.” He said he was unpaid as secretary and it was “an act of brotherly love”.
After inviting us into his kitchen, Farage was asked why he told EU officials he was paid for “commodity broking”, as he had said to our reporter he gave up business in 2004.
He replied: “Just to be careful, purely caution. I was over-declaring. I didn’t need to do it.” He said he was unpaid as secretary and it was “an act of brotherly love”.
Companies House documents show the
offshore trust remained a shareholder in Farage Limited until 2011. The
right-winger insisted it shut down in 2007 or 2008.
He said: “I sent a cheque off to set it up, out of my own taxed income, and basically just through administration fees that money disappeared.” Accountant Mr Watson said he was not involved in setting up the Isle of Man trust for Farage.
He said: “I sent a cheque off to set it up, out of my own taxed income, and basically just through administration fees that money disappeared.” Accountant Mr Watson said he was not involved in setting up the Isle of Man trust for Farage.
He revealed Farage Limited lost a major
client in 2011 and owed unpaid corporation tax. Six weeks after the Eurosceptic
resigned as company secretary in 2011, HMRC filed a petition to wind up the
company.
Farage Limited went into a “voluntary arrangement” in 2011, one step short of going into administration. Its debts of more than £100,000 are due to be paid off by 2017.
Farage Limited went into a “voluntary arrangement” in 2011, one step short of going into administration. Its debts of more than £100,000 are due to be paid off by 2017.
Good for him. This should make Farage alot more popular.
ReplyDeleteAs Peter Hitchens wrote-"what on Earth is moral about paying tax"?
Who on Earth came up with the idea that the state can spend our money better than we can?
Our taxes fund expenses-grabbing MP's, illegal wars, mass abortion and sex education, greedy Local Authority bureaucrats and schools that don't educate anybody, police that don't patrol the streets and thus don't prevent crime, prisons that don't punish and hospitals where old people die in their own filth.
Why the hell do we consider it a moral obligation to give the state as much of our money as possible?
You are on your own there. Well, you and Delingpole. Farage himself has apologised.
ReplyDeleteIf UKIP were a serious party, then he would have been out on his ear, apology or not. Mostly for having kept this hidden. It's always the cover-up.
He shouldn't have apologised-he's done nothing remotely wrong.
ReplyDeleteIn fact, this is brilliant.
Tax avoidance should only ever be an issue when the people doing it are Left-wingers who urge high taxes for everyone else!
There should be a special tax levied on them (along the lines of Peter Hitchens proposed Tax On Being A Left-wing Windbag)
But the rest of us should be free to avoid tax.
Well, he has apologised, so get out of that one.
ReplyDeleteIndeed-sadly, even Farage occasionally surrenders to political correctness and fashionable opinion.
ReplyDeleteParticularly the especially bizarre fashionable opinion (espoused by UK Uncut etc) that a wasteful, dishonest, authoritarian anti-Christian state can spend our money better than we can.
What shall we give them more tax money for?
To pay for more wars in the Middle East, an increase in the EU's budget, more useless police officers whom we never see and more free abortions on the NHS?
Avoiding tax is actually a moral obligation, in this country.
Well, we really have found the level there. Perhaps you should put up as Real UKIP wherever Farage tries his luck in 2015?
ReplyDeleteBetter than that, I reckon you should put up as "Real Labour" and run on an anti-gay marriage, anti-abortion, anti-immigration, anti-EU ticket wherever Miliband tries his luck in 2015.
ReplyDeleteThat'll be hilarious.
Watch that great "2010 Catholic intake" just flocking to your message.
Or not.
That's no, then.
ReplyDelete