I'm speaking at Spear’s 500 Live on 6 May - "bringing together the most senior and influential figures in private wealth, luxury and law" for "ultra-high-net-worth clients".
Naturally I'll be talking about how they can avoid tax more successfully.
buff.ly/DhAJvuk
Thank you!
I don’t know! It’s mystifying!
More posts. Congratulations.
Too busy with friendsreunited tbh
Just heard about an insane "tax avoidance" scheme being pitched to recruitment agencies, involving paying HMRC with a "bill of exchange".
I'd think it was a joke if it hadn't come from an unimpeachable source.
If you come across this, do get in touch in complete confidence.
Big news - we've decided to follow the latest 2004 tech trends and set up a Facebook page.
Please tell all your friends/grandparents buff.ly/N308fF4
Currently zero followers - hoping to make it to seven by end today.
Funnily enough here they did! One of the companies declares dividends in its accounts which legally it shouldn’t have received. Really odd.
It is odd they don’t automatically check that REIT shareholders are paying corporation tax.
Thank you!
Correct. All the same structure.
Probably there is more.
If you want to read more communist Labour neoliberal Tory toff analysis, you can follow me here or subscribe at taxpolicy.org.uk/subscribe
Disclosure: I'm a member of the Labour Party. But everyone paying attention knows I call it as I see it.
I've investigated Rayner, Starmer, Lavery, Zahawi.
I've refuted accusations that Jeremy Hunt (twice), Rishi Sunak and Nigel Farage avoided tax.
I annoy everyone.
We worked on this story with Gabriel Pogrund of The Sunday Times - his story is here: buff.ly/PLKDf5s
Full details in our report, including how we come up with the numbers, and why we are so confident there were no losses in the group. 25 tax lawyers and accountants contributed - for which many thanks.
buff.ly/9v30CL2
Dear Mr Lewis, I am writing to request Mr Tice's comments on another report we will be publishing in conjunction with The Sunday Times, concerning the tax structuring of Quidnet REIT. As the Sunday Times reported in March, four companies - Tisun One Ltd, Tisun Two Ltd, Tisun Three Ltd and Tisun Four Ltd - received over £500,000 in dividends from Quidnet but paid no corporation tax. Mr Tice told the Sunday Times that this was due to losses elsewhere in the group, and "the accountants advise on this and sign the audit and they are top drawer so I trust them" In reality: 1. None of the Tisun companies had an auditor. The only person signing the accounts was Mr Tice. 2. the accounts of Tisun One/Two/Three/Four don't show losses being used. They show the dividends as tax exempt. This was a basic tax error: dividends/PIDs from REITs are fully taxable.
3. there were no material tax losses in the group. Our team has reviewed the filed accounts of the wider Tisun group. They show neither sufficient qualifying tax losses nor any business activity capable of generating losses of the scale required to shelter the Tisun companies' REIT income. We will be reporting that the explanation Mr Tice provided was incorrect, and that the company unlawfully failed to pay c£100k of tax. We will say that we expect HMRC will be able to recover that tax, plus about £27,000 of interest. Because this is such a simple point, we expect HMRC to regard the error as "careless" and seek penalties of 10-15%. If you have any comments, please provide them by 5pm tomorrow. Yours sincerely, Dan Neidle
We asked Richard Tice's lawyer for comment.
We didn't receive a response (and neither did the Sunday Times).
So: £98k of corporation tax is due. Plus about £27k of interest
This was a really basic mistake. Everyone in REIT world knows that REIT distributions are taxed - it's not some point only the tax nerds know
That means HMRC are likely to assess penalties for carelessness
TL;DR
The Tisun companies failed to pay tax on £514k of dividends.
Richard Tice's claim this was because of losses is contradicted by
- the accounts, which show a (wrong) use of dividend exemption - the fact there **were no material losses**
So Tisun Investments Ltd did not generate material losses that could be used to shelter profits elsewhere in the group.
(It looks like its accountants agreed, as there’s no sign of a deferred tax asset, or any mention of losses or group relief.)
And its liabilities:
- 270,000 preference shares at 7% (ignored for tax)
- interest-free loans from related parties
None could generate material tax losses
(Way more detail on all this in our report; what the assets/liabilities were and why no tax losses could arise)
Nope. Because these were its assets:
- £600k of unmortgaged residential real estate
- a car on HP
- £120k of unlisted investments
- shareholdings in its subs
- Loans to related parties
- a loan to Reform UK
None could generate material tax losses
Tisun Investments' balance sheet - £3.1m of assets and about a £70k fall in profit and loss account over the year.
Tisun Investments much busier.
So maybe Tisun Investment had big tax losses it surrendered to the Tisun companies?
Tisun Holdco's 2021 balance sheet showing only £32k of assets and no change in the profit and loss account from the previous year.
Tisun Holdco was a nothingburger. Can't have made losses.
A group structure chart showing the four Tisun companies held by Tisun Investments. Tisun Investments held by Tisun Holdco Tisun Holdco held by Richard Tice.
Here's the group.
The only companies that could have had losses for the Tisun companies to use were Tisun Holdco and Tisun Investments.
But maybe Tice is right now and the accounts were wrong in 2022? Maybe the Tisun companies were using group losses?
Problem is: there were no group losses.
Richard Tice signed Tisun accounts for 2021
The accounts weren't audited. We don't know who prepared them, but Richard Tice signed them:
A table showing total REIT distributions received by the Tisun companies over three years were: Tisun One: £161,202 Tisun Two: £160,876 Tisun Three: £160,876 Tisun Four: £30,947 Total: £513,901
The wrong use of the dividend exemption appears over all four companies for three years.
The total untaxed income was £513,901. The corporation tax rate at the time was 19%, and so the unpaid tax was £97,641.
Full workings/reconciliations in our report.
iXBRL code showing the tag TaxIncreaseDecreaseFromEffectDividendsFromCompanies was applied to the negative 11,572 figure
Maybe someone was being sloppy and typed "dividend income" when they really meant "dividend income is sheltered by losses".
Nope. The code the accountants' software submitted to Companies House contains a specific dividend exemption tag
More in this in our report.
Tax reconciliation showing £11,572 of tax being cancelled by £11,572 of dividend exemption.
Second, the accounts don't show what Tice claimed.
This (T3, 2021) shows £60,906 of dividend income and says expected tax = £11,572, but cancelled by dividend exemption.
Not losses.
And **There is no dividend exemption for REIT distributions**
The front page of Tisun Three's accounts. It says they're "unaudited".
First, the easy one: the accounts weren't audited. It says so on the front page.