Rishi's wife does not pay tax (millions!!) on dividends!

[FlowerArranger]

From today's Guardian :

Rishi Sunak’s multi-millionaire wife claims non-domicile status, it has emerged, which allows her to save millions of pounds in tax on dividends collected from her family’s IT business empire.

Akshata Murthy, who receives about £11.5m in annual dividends from her stake in the Indian IT services company Infosys, declares non-dom status, a scheme that allows people to avoid tax on foreign earnings.

www.theguardian.com/politics/2022/apr/06/rishi-sunaks-wife-claims-non-domicile-status?CMP=Share_AndroidApp_Other

Anyone as outraged by this as I am? I mean what the actual fuck?

"It’s a loophole which she is exploiting. "

To me it's no a loophole. It's Hmrc rules. She can apply for remittance basis if she meets the conditions. Just like anyone else who meets the conditions. That's not a loophole that a clever tax accountant has discovered. That's available to any non domiciled individual with more than £2k foreign income.

People might not like the rules and there is a discussion there, but it's not a loophole.

@Eleganz - agree with your post.

Non dom status isn't static. She may well have been non dom in the past but not now.

I'm waiting for the media to now name all the entertainers, football players and other multi-millionaires who are non-dom as well. Bet that's not going to happen as:
A - it's not part of their current narrative
B - what they're doing is not illegal.

You forgot C, they're not married to the Chancellor of the Exchequer.

It really is quite abundantly clear that who AM is married to is the reason for this being of such significant interest. That's why it's so important. One could think she's done nothing wrong at all whilst also acknowledging that incredibly blatant point. With that in mind, your post is very disingenuous.

It’s a loophole which she is exploiting.

It isn't a loophole though. It is how the legal exemption was set up. This is how it works, how it was always meant to work. Not what it says on the tin, but exactly what it was designed for. That's why there is a slidign scale of payments to be made. So, whilst the dividends themselves are not taxed here in the UK, there is payment made every year for her having received them, and any other earnings out of the country.

Those who have been living in the UK for at least seven of the previous nine tax years must pay £30,000 a year to the government. Those who have lived in the UK for 12 of the previous 14 tax years must pay £60,000 a year. UK residents must pay tax on their worldwide earnings once they have been in the country for 15 of the previous 20 years.

The thing that would be heinous would be is she went home to India for a while and then came back, resetting her non dom clock. Which might happen if/when her parents require help, nursng. Who kows. It hasn't happened, may never happen. But the conjecture is being made to fan the flames.

Seek the person with the fan...

@Cheekymaw

We get the Government we deserved . The public get what the public want as Mr Weller said.

Yeah, er not really. As always even amongst those who can be arsed to vote, quite a lot more people didn't vote for this current shower of cunts than did. On the other hand, I suppose our apparent unwillingness to change our antediluvian voting systems means we doomed to repeat this.

"I'm waiting for the media to now name all the entertainers, football players and other multi-millionaires who are non-dom as well. Bet that's not going to happen as:
A - it's not part of their current narrative
B - what they're doing is not illegal."

Off the top of my head Jensen Button, Lewis Hamilton, Michael Caine, Phil Collins, Phillip Green, Sean Connery & Mick Jagger. In fairness they do seem to primarily live outside the UK - unlike Murty.

And although her non dom status is technically legal HMRC can and do investigate this loophole. The statement from her representative 'explaining' the reasons has been pulled apart as factually untrue. Yet again this is another rule that the mega rich are allowed to interpret to suit their own greed. If the laws were changed so there was a definite right or wrong like the rest of us have to live by then it would be far simpler. But our ruling leaders past and present have managed to keep these tax rules very complex. And don't people just hate it when we dare to question. They all make me sick.

[quote Notonthestairs]@Eleganz - agree with your post.

Non dom status isn't static. She may well have been non dom in the past but not now.

[/quote]
Even if she elected to pay on the arising basis, she would still be non-domiciled.

What do you mean @tigger1001 ? She doesn't have to be non Dom, especially since UK is where she lived most of the time. That's the bit that makes it immoral for me.

@Cheekymaw

We get the Government we deserved . The public get what the public want as Mr Weller said.

Later on in that song it's "the public wants what the public gets" which seems more apt - all those non-millionaire aspirational Tory voters chanting "shaft us some more, we're scum, we deserve it!"

But you don't need non dom status unless you live here?!

@tigger1001 - sorry, I don't follow. Are you saying that HMRC (or relevant body) can't review & change her status if they think circumstances have changed? Not being goady - I'm interested.

As far as I can see she's chosen to apply for this and can equally choose to have it removed.

@SamphirethePogoingStickerist

But you don't need non dom status unless you live here?!

But the idea is that an individual is temporarily resident here Her residency looks pretty permanent don't you think. HMRC looks at where you buy your Residential property. Where your kids go to school etc. It seems she is using the excuse that she intends to return to India at some point to care for her billionaire parents god bless them as they reason for electing to be non dom.

@tigger1001

"She is married to the chancellor, for one thing. And she LIVES here, which the rules say mean she should pay here. And if she doesn't, that's interesting too."

The rules say she can elect to pay tax on her overseas earnings on the remittance basis as a non domiciled individual. She has chosen to do so. All within the tax rules.

That's not true, though, is it? She isn't someone residing in the UK whose PERMANENT HOME, or domicile, is abroad. She is married to a UK secretary of a state and her permanent home is here.

It's all bullshit and scams, and fuck the rest of us. In fact, squeeze the rest of us. They all stink.

@Notonthestairs

"I'm waiting for the media to now name all the entertainers, football players and other multi-millionaires who are non-dom as well. Bet that's not going to happen as: A - it's not part of their current narrative B - what they're doing is not illegal."

Off the top of my head Jensen Button, Lewis Hamilton, Michael Caine, Phil Collins, Phillip Green, Sean Connery & Mick Jagger. In fairness they do seem to primarily live outside the UK - unlike Murty.

Well Sean Connery is definitely outside the uk tax system considering he passed away a few years ago.

The others? I don't know their domicile and whether they have changed it to the country they reside in. If they don't live here they will not be uk resident, but could still be domiciled.

"That's not true, though, is it? She isn't someone residing in the UK whose PERMANENT HOME, or domicile, is abroad. She is married to a UK secretary of a state and her permanent home is here."

Do you know that? Is she planning to live in the uk forever? Is she planning to return to India when her husbands political career is over?

If her domicile of origin hasn't changed, then she is entirely following the tax rules.

I’ve just read on Apple news that they both were registered as permanent residents of the US whilst he was chancellor! Yes it maybe within rules but it’s still immoral, greedy and means poor people have to basically shoulder HIS tax burden which he can easily afford and continue to live a life of luxury with. It’s absolutely disgusting. People running the country should care about the people in it, not just themselves. Vile. The next government needs to get taxation sorted properly.

at Sean Connery. Poor guy not even allowed to rest in peace!

@mrshoho

at Sean Connery. Poor guy not even allowed to rest in peace!

oh my. Apologies. 😳

@tigger1001

"That's not true, though, is it? She isn't someone residing in the UK whose PERMANENT HOME, or domicile, is abroad. She is married to a UK secretary of a state and her permanent home is here."

Do you know that? Is she planning to live in the uk forever? Is she planning to return to India when her husbands political career is over?

If her domicile of origin hasn't changed, then she is entirely following the tax rules.

And how convenient that our law gives an individual 15 years to make this decision! The laws need reforming. It is wrong.

Agree whilst it’s not illegal it’s immoral.
For someone who is currently residing at 11 Downing St, at the heart of British Government, to avoid paying tax whilst the rest of the country are struggling, it leaves a very nasty taste in the mouth.
As for Rishi ( and the others in the Tory govt) it shows how little they care about the Rey of us.

What she's doing is not illegal, she will have to pay taxes somewhere and in this case it's inn India. I similarly lived in another European country while paying tax on my earnings in the U.K. not everyone's tax situation is so cut and dry especially if you work for a foreign company but live in another country.

It's not illegal but it's immoral and the rules need to be changed. Every year she signs a form to say she has no intention of being permanently resident in the UK, which is clearly a load of proper stinking bollocks.

All the hoo haa about parents showing a council tax bill to even get in a school and to prove they are permanently resident in an area, yet someone wealthy can clearly be permanently resident in the UK and pay £30K to HMRC and all that goes away for them.

It's just them and us, one law for them, one law for the plebs and this Government all over.

@SamphirethePogoingStickerist
That's exactly right. Something isn't a loophole if there's a box on your tax return to claim it and a specific charge to pay to opt in.

It's like companies claiming research and development relief or an individual getting a lower rate of inheritance tax because they have donated a certain portion of their estate to charity. There's no box on the tax return which says "please divert my income through the Cayman islands using a 12 step process and various trust structures" because it's not intended by parliament that you do that.

Non-dom status and the remittance basis is a very longstanding and intentional part of the tax system. It isn't something which Sunak or the Tories have just invented for their own benefit.

It remains because:

• overall it likely raises more tax revenue than it loses - although rich non-doms save tax by using the remittance basis if they didn't have this option a lot of them would ensure that they are not UK resident at all and therefore pay no / minimal UK tax;
• there are economic benefits to the UK in rich people living and spending money here;
• it helps attract foreign business people etc. to the UK e.g. the head of a large foreign tech company is headhunted to the UK. They have a significant stake in the foreign tech company which they get dividends from. Without the remittance basis they would have to pay UK tax on these foreign dividends (less any foreign tax already paid). They may well decide not to take the opportunity or to do so in a way where they don't become UK resident;
• there are compliance issues in terms of working out how much foreign income which never comes into the UK someone is actually making.

Fine to disagree with that rationale but that's why the system is as it is.

There's a question of fact as to whether Murthy actually legitimately has non-dom status here but people have explained upthread why that might be plausible (basically that changing domicile is quite difficult and doesn't necessarily depend on how much time you spend in the UK).