This is a story from ten years ago.
Owl still can’t get their head around someone so careless as to let a £5m bill to HMRC “slip between the cracks” could ever be fit to be Chancellor. Suppose it’s only small change to Rishi!
Les Reid www.coventrytelegraph.net
Millionaire MP Nadhim Zahawi used a company in an offshore tax haven to buy his constituency home in Warwickshire.
Conservative MP Mr Zahawi – an adviser to David Cameron – used the company in low-tax Gibraltar as a lender to buy an estate and riding stables now worth £1 million in Upper Tysoe, near Stratford-upon-Avon, in 2011.
Berkford Investments Limited were traced to a PO box in the British overseas territory off Spain and to a residential address in Putney, south London.
Documents obtained from Companies House in Gibraltar show Berkford Investments Limited is managed by T&T Management Services Limited, which shares the same address.
Using offshore companies is commonplace and not unlawful. There is no suggestion that Mr Zahawi or his wife avoided any taxes by financing their purchase with a mortgage from the Gibraltar-based company.
Earlier this month, it was revealed that Mr Zahawi’s MP expense claims for his Upper Tysoe 31-acre ‘second home’ estate included energy bills of £5,800 in 2012/13, including for his riding school business.
MPs’ expenses can only be claimed “wholly, exclusively and necessarily” in performing Parliamentary duties.
Mr Zahawi initially denied wrongdoing, but later admitted a “mistake” in claiming for the riding school, and pledged to pay back any claim made in error.
“While a meter was installed in the stable yard I have only been receiving one bill and had not deducted usage on that meter from my claims,” he explained.
Mr Zahawi and his wife Lana used the Gibraltar company when the couple became the “registered owners” for Oaklands stables in May 2011, a year after the London-based wealthy businessman became MP for Stratford.
The couple bought the property for £875,000, and Berkford Investments Limited is registered as the “lender” for the purchase. Documents state a charge as security against the property is owned by the lender “Berkford Investments Limited (incorporated in Gibraltar)”.
Two addresses are given for the company – a residential property in Putney, London SW15, and 28 Irish Town, PO Box 15, Gibraltar. Company records trace Berkford Investments Limited back to 2006.
Gibraltar promotes itself as a low-tax location for finance and business. It features heavily in websites advising the wealthy on how to minimise taxes by setting up a company there.
Despite Gibraltar’s long-standing reputation as a tax haven, it is not among the Organisation for Economic Co-operation and Development’s list of “uncooperative tax havens” – set up to help stamp out tax evasion and improve transparency.
Mr Zahawi was asked whether he considered it politically unwise to have any arrangement with Berkford and T&T Management Services Ltd.
Mr Zahawi responded: “I did pay stamp duty on my property in Tysoe and have always paid stamp duty on my property purchases.
“I fully support the 2012 budget and all budgets of this government. I purchased my property in Tysoe with a mortgage from a Gibraltar company.
“This fact and the details involved are fully declared on the Land Registry and to suggest it is in any way hidden would be factually incorrect.
“Equally, to suggest that in any way I am using offshore to reduce my tax burden is entirely incorrect.”
* Rising Tory star Nadhim Zahawi, a Kurd whose family fled Iraq for the UK when he was nine, is also the registered owner of another residential property in Putney, which he bought for £1.85 million in December 2005.
The father-of-three’s business consultancy firm, Zahawi & Zahawi Ltd, is registered to this address with Companies House.
His declarations in the MPs’ Register of Financial Interests include his non-executive directorship of London-based SThree specialist recruitment firm, from which he receives a monthly salary of £2,916.67 for seven hours’ work attending board meetings.
Zahawi & Zahawi Ltd is also registered. Mr Zahawi’s shareholding in YouGov Plc is mentioned despite it being below the “registrable level”.
Mr Zahawi’s declarations under ‘Land and Property’ in last month’s MPs’ register of interests includes “31 acres of land in Warwickshire, with stables run as a livery yard by Zahawi & Zahawi Ltd.”
Also entered is: “Residential buy to let property in London, divided into three flats (Registered 12 June 2013).”
Land and Property entries in the register in January last year included: “One residential property in London, from which rental income is received, Sale of flat completed on 31 January 2011.”
His entry in September 2010 also listed: “One residential property in London, from which rental income is received.”
A previous version of this story which was first published in 2013 said T&T management services ltd’s website advertises its services as administering trusts for wealthy individuals and families to manage their assets, and avoid or minimise paying property taxes. We have been asked to point out T&T Management Services Limited is regulated by the Gibraltar Financial Services Commission to provide company management and trust services and they have advised that the business of TTMS does not include the avoidance or minimisation of property taxes. CoventryLive is happy to clarify this.