#Nadhim Zahawi ‘may have avoided millions in tax with trust’
[*Billy Kenber*](https://www.thetimes.co.uk/profile/billy-kenber), Senior Investigations Reporter | [*George Greenwood*](https://www.thetimes.co.uk/profile/george-greenwood), [*Mario Ledwith*](https://www.thetimes.co.uk/profile/mario-ledwith)
*Saturday July 16 2022, 12.01am*, The Times
___
Nadhim Zahawi has been accused of giving a misleading explanation of his tax affairs amid allegations that he may have avoided millions in tax by using an offshore family trust. Before moving into politics, the chancellor made his name in business as one of two co-founders of YouGov, the polling company set up in 2000.
Zahawi, 55, has faced growing questions for allocating 42.5 per cent of the business — the shares that he was entitled to as co-founder — to Balshore Investments, a Gibraltar-based company held by a trust controlled by his parents. Zahawi took no shares at that time.
The stake owned by Balshore Investments was eventually sold for about £27 million. If the shares had been held by Zahawi, capital gains tax of about £3.7 million would have been due.
Earlier this week, he denied any tax benefit from the structure and told The Times that his father, Hareth, had previously set it up and had been entitled to the shares because of the “very considerable business know-how” he gave to the venture.
Zahawi’s spokesman said he “had no experience of running a business at the time and so relied heavily on the support and guidance of his father, who was an experienced entrepreneur”.
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He said Zahawi’s father had provided £7,000 in start-up capital to YouGov as well as financial support to his son, who had given up his job for the business.
This explanation now appears to have been undermined YouGov’s company secretary, Tilly Heald, who said that Hareth Zahawi had not advised the business and was merely a shareholder. “To YouGov’s knowledge, YouGov had/has no association with Hareth Zahawi beyond any interests he may have held/holds in Balshore Investments Ltd in its capacity as a YouGov shareholder,” Heald said.
Employees who worked at YouGov in its early years had no recollection of Zahawi’s father being in the office and were surprised to hear of his alleged involvement with the business.
According to experts, Zahawi may have avoided tax if he deliberately manoeuvred shares into his father’s offshore company with the intention that he or his family would subsequently benefit through gifts and loans.
Corporate and property records show that in 2005 a loan of £99,000 that Zahawi owed to YouGov was at least in part repaid from dividends that had been due to Balshore. Zahawi’s spokesman described this as a gift from his father. Another Gibraltar-based firm that appears to be linked to his father, Berkford Investments, provided a loan that Zahawi used to buy a home and livery yard in Stratford-upon-Avon.
A spokesman said Zahawi was not aware of any tax advantages arising from this arrangement and it was simply “convenient” to take the loan.
For the tax authorities to accept Zahawi’s explanation that his father was entitled to the YouGov shares and it was a genuine commercial transaction, officials would have to be persuaded that his father’s advice was worth the value of the shares. Based on the sum paid by another businessman who invested at the same time, the shares transferred to Balshore in 2000 were worth at least £813,000.
Dan Neidle, head of Tax Policy Associates, a think tank, said it was “hard to see why Zahawi would be providing false and contradictory explanations other than the obvious conclusion that this was a tax avoidance structure”.
It has previously been reported that HM Revenue & Customs is investigating Zahawi’s tax affairs after receiving a referral from the National Crime Agency. Zahawi has denied any wrongdoing and said he would co-operate with any inquiries. There is no suggestion of tax evasion, which is illegal.
> In fact, this transaction, where shares were transferred to his father but it looks like they were actually owned by Zahawi, has many of the hallmarks of tax evasion (which, yes, is a crime).
> I think an independently minded expert, looking at it, would say it was more likely than not that it was tax evasion. It’s not easy to find an alternative explanation consistent with the reported facts.
> If that’s right, although Zahawi is out of the leadership contest, he is still Chancellor of the Exchequer. So we’d remain in the remarkable position of having a Chancellor who may well have committed substantial tax evasion.
> And what’s more, he has very significant influence over the body (HMRC) investigating his tax affairs. So he has an impossible conflict of interest. Extraordinary stuff.
In order to be silly rich, it helps to avoid giving it away, thats something the working class do and as can be seen, we are nowhere near £100 million networth.
Remember kids, you only go to prison if you’re poor.
Tax-loops somehow being a hands-on-hips, well you’re naughty but you’re legal! is frustrating to say the least.
His argument is basically that it can’t be evasion because he is too dumb to deliberately mislead…which is an interesting flex for someone who is in charge of the entire country’s money.
“Man doesn’t break law”
It’s getting to the point that all Tories must be viewed as corrupt until proven otherwise.
Naza told us it was all a smear campaign against him and that examining things retrospectively wasn’t the right thing to do. Which made my ex civil-servant dad spit out his tea and asks how he thinks crime works : /
“Oh my word the shock!” Said no one ever
Oh look, a Tory once again turns out to be a shitbag, colour me surprised.
MPs make these laws with loopholes they can take advantage of.
How long can this realistically go on before the collective consciousness decides to purge them all? It seems ridiculous that these smirking, alcoholic posh kids continue to do as they will at the expense of the public with out being Gadaffi’d in the street.
12 comments
#Nadhim Zahawi ‘may have avoided millions in tax with trust’
[*Billy Kenber*](https://www.thetimes.co.uk/profile/billy-kenber), Senior Investigations Reporter | [*George Greenwood*](https://www.thetimes.co.uk/profile/george-greenwood), [*Mario Ledwith*](https://www.thetimes.co.uk/profile/mario-ledwith)
*Saturday July 16 2022, 12.01am*, The Times
___
Nadhim Zahawi has been accused of giving a misleading explanation of his tax affairs amid allegations that he may have avoided millions in tax by using an offshore family trust. Before moving into politics, the chancellor made his name in business as one of two co-founders of YouGov, the polling company set up in 2000.
Zahawi, 55, has faced growing questions for allocating 42.5 per cent of the business — the shares that he was entitled to as co-founder — to Balshore Investments, a Gibraltar-based company held by a trust controlled by his parents. Zahawi took no shares at that time.
The stake owned by Balshore Investments was eventually sold for about £27 million. If the shares had been held by Zahawi, capital gains tax of about £3.7 million would have been due.
Earlier this week, he denied any tax benefit from the structure and told The Times that his father, Hareth, had previously set it up and had been entitled to the shares because of the “very considerable business know-how” he gave to the venture.
Zahawi’s spokesman said he “had no experience of running a business at the time and so relied heavily on the support and guidance of his father, who was an experienced entrepreneur”.
Advertisement
He said Zahawi’s father had provided £7,000 in start-up capital to YouGov as well as financial support to his son, who had given up his job for the business.
This explanation now appears to have been undermined YouGov’s company secretary, Tilly Heald, who said that Hareth Zahawi had not advised the business and was merely a shareholder. “To YouGov’s knowledge, YouGov had/has no association with Hareth Zahawi beyond any interests he may have held/holds in Balshore Investments Ltd in its capacity as a YouGov shareholder,” Heald said.
Employees who worked at YouGov in its early years had no recollection of Zahawi’s father being in the office and were surprised to hear of his alleged involvement with the business.
According to experts, Zahawi may have avoided tax if he deliberately manoeuvred shares into his father’s offshore company with the intention that he or his family would subsequently benefit through gifts and loans.
Corporate and property records show that in 2005 a loan of £99,000 that Zahawi owed to YouGov was at least in part repaid from dividends that had been due to Balshore. Zahawi’s spokesman described this as a gift from his father. Another Gibraltar-based firm that appears to be linked to his father, Berkford Investments, provided a loan that Zahawi used to buy a home and livery yard in Stratford-upon-Avon.
A spokesman said Zahawi was not aware of any tax advantages arising from this arrangement and it was simply “convenient” to take the loan.
For the tax authorities to accept Zahawi’s explanation that his father was entitled to the YouGov shares and it was a genuine commercial transaction, officials would have to be persuaded that his father’s advice was worth the value of the shares. Based on the sum paid by another businessman who invested at the same time, the shares transferred to Balshore in 2000 were worth at least £813,000.
Dan Neidle, head of Tax Policy Associates, a think tank, said it was “hard to see why Zahawi would be providing false and contradictory explanations other than the obvious conclusion that this was a tax avoidance structure”.
It has previously been reported that HM Revenue & Customs is investigating Zahawi’s tax affairs after receiving a referral from the National Crime Agency. Zahawi has denied any wrongdoing and said he would co-operate with any inquiries. There is no suggestion of tax evasion, which is illegal.
After noting the article’s conclusion: “There is no suggestion of tax evasion, which is illegal”, Good Law Project’s Jo Maugham comments in [a series of tweets](https://twitter.com/JolyonMaugham/status/1548203017484193793):
> In fact, this transaction, where shares were transferred to his father but it looks like they were actually owned by Zahawi, has many of the hallmarks of tax evasion (which, yes, is a crime).
> I think an independently minded expert, looking at it, would say it was more likely than not that it was tax evasion. It’s not easy to find an alternative explanation consistent with the reported facts.
> If that’s right, although Zahawi is out of the leadership contest, he is still Chancellor of the Exchequer. So we’d remain in the remarkable position of having a Chancellor who may well have committed substantial tax evasion.
> And what’s more, he has very significant influence over the body (HMRC) investigating his tax affairs. So he has an impossible conflict of interest. Extraordinary stuff.
In order to be silly rich, it helps to avoid giving it away, thats something the working class do and as can be seen, we are nowhere near £100 million networth.
Remember kids, you only go to prison if you’re poor.
Tax-loops somehow being a hands-on-hips, well you’re naughty but you’re legal! is frustrating to say the least.
His argument is basically that it can’t be evasion because he is too dumb to deliberately mislead…which is an interesting flex for someone who is in charge of the entire country’s money.
“Man doesn’t break law”
It’s getting to the point that all Tories must be viewed as corrupt until proven otherwise.
Naza told us it was all a smear campaign against him and that examining things retrospectively wasn’t the right thing to do. Which made my ex civil-servant dad spit out his tea and asks how he thinks crime works : /
“Oh my word the shock!” Said no one ever
Oh look, a Tory once again turns out to be a shitbag, colour me surprised.
MPs make these laws with loopholes they can take advantage of.
How long can this realistically go on before the collective consciousness decides to purge them all? It seems ridiculous that these smirking, alcoholic posh kids continue to do as they will at the expense of the public with out being Gadaffi’d in the street.