British Labour Party politician, Ken Livingstone, has reportedly used a tax avoidance loophole to avoid over £50,000 in tax…
Former Mayor Ken Livingstone, has reportedly avoided over £50,000 in tax according to Companies House documents that have surfaced. The Companies House documents show that, Mr Livingstone, who was beaten by Boris Johnson in the last mayoral election of 2008, established a new company in which his earnings for 2009 were paid into. The personal company, Silveta Ltd, was set up by Ken and his wife, Emma Beal, to which both parties are sole shareholders. It has been reported that in 2009 Mr. Livingston earned £232,000 for his personal appearances, public speeches and for hosting his Saturday morning radio show on Capital’s commercial talk radio station, LBC 97.3FM.
Paid through his personal company, Silveta Ltd, Mr. Livingstone will probably have paid corporation tax on his earnings at a rate or 20-21% rather than the income tax rate of up to 40%. Half of Livingstone’s earnings could also have been paid to his wife through the company as his ‘assistant’, allowing him to save even more of his reported income.
Silveta Ltd’s accounts for 2010 show there to be around £320,000 cash in the company with £284,000 of earnings invoiced in 2010 alone; By leaving earnings in the company, shareholders –ironically Livingstone’s wife and himself – can avoid paying large amounts of income tax.
Mr. Livingstone, said:
“The company has paid [corporation tax] and when it pays me you pay an amount that is effectively the same rate as you would have done on income tax.”
Humorously Mr. Livingstone has attacked the tax avoidance loophole he so very used as “Robin Hood in reverse” and has made targeting “the rich” the main role of his 2012 mayoral election campaign by demanding for a top tax rate of 80%.
Labour’s candidate for London’s mayoral election publicly branded tax avoiders as ‘rich b*******’ and said that they should “not be allowed to vote in a British election, let alone sit in Parliament, unless they pay their full share of tax”.
During a debate last week Mr. Livingstone declared: “I have a normal life, I have a normal home”.
Kevin Kinsella Jnr, of KinsellaTax, said:
“Sorry but Ken has done nothing wrong. It is an arrangement used by many people and in spite of the publicity he has done nothing wrong. I think the media are flogging a dead horse, find something else to write about, it’s old hat.”
KinsellaTax’s staff consists of ex-HM Inspector of Taxes and ex-HM Custom and Excise Officers.
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