Richard Tice is under scrutiny to clarify allegations surrounding his company’s failure to pay over £90,000 in taxes. The deputy leader of Reform UK reportedly did not fulfill the necessary tax obligations on dividends before they were transferred to him and his offshore trust.
Tice, who serves as the business, trade, and energy spokesperson for Nigel Farage’s party, allegedly received excess payments totaling at least £91,000 due to this purported oversight, as reported by the Sunday Times. The accusations pertain to his property investment firm, Quidnet REIT Ltd, which holds the status of a real estate investment trust (REIT).
REITs are granted a tax exemption during a specific period, and instead of paying corporation tax, they distribute a portion of earnings to shareholders, who are then individually taxed. According to The Times, REITs are required by law to deduct a percentage of dividends, known as withholding tax, before disbursing payments to shareholders, which is taxed at the 20% basic income tax rate.
Allegedly, Tice’s company violated this regulation by failing to withhold tax on dividends in at least three instances between 2020 and 2021. The Sunday Times claimed that Tice did not deduct tax from dividends totaling around £456,000, resulting in a tax deficit of approximately £91,200.
Tice has maintained that he paid the highest tax rate on all received dividends and asserts that HMRC has been fully compensated. Tax expert Dan Neidle expressed that the failure to pay tax appears to be a careless oversight and emphasized the importance of adhering to tax regulations in the property sector.
Labour’s chair, Anna Turley, labeled the situation as a significant scandal and called for Tice to promptly address the issue, repay the outstanding tax, and face the consequences. She questioned Tice’s credibility and integrity in light of these allegations.
In response, Tice accused the Sunday Times of attempting to tarnish his reputation, stating that despite the scrutiny, HMRC received the correct tax amount owed. This incident comes after a previous investigation into Tice’s firm’s REIT status, where allegations of tax avoidance emerged.
Reform UK’s home affairs spokesman, Zia Yusuf, downplayed the recent claims, referring to them as a non-issue resulting from a minor administrative error made by the company. He highlighted that Tice would have paid income tax on the dividends received, ultimately resulting in the correct tax payment to HMRC.
Labour criticized Yusuf’s dismissal of the allegations, emphasizing the importance of tax compliance for public trust. They raised concerns over Tice’s ability to manage tax responsibilities effectively, casting doubt on his party’s credibility with regards to financial matters.