Undercover filming by the Guardian suggests multimillionaire UK residents are being pitched offshore products said to legally protect their fortunes from inheritance tax (IHT) and capital gains tax (CGT).
At a private event held a week before the general election, the international accounting brand Baker Tilly told advisers to the ultra-wealthy how they could use offshore pension schemes to shield their clients' fortunes from tens of millions of pounds of inheritance taxes.
One promoter told how his client had placed £30m into a pension scheme to protect it from inheritance taxes. He told an undercover reporter at the exclusive event in the City of London that the government would not legislate to close the schemes down as ministers have "bigger fish to fry".
While the schemes are legal, critics argue tax avoidance is immoral and deprives the public purse of hundreds of millions of pounds that could fund vital services.
Labour has promised to renew the focus on tax avoidance by "the wealthy" to "ensure everyone pays their fair share" as it grapples with threadbare public finances and growing demands to settle long-running disputes over public sector pay and benefits. The chancellor, Rachel Reeves, is due to give more details about the state of the public finances next week, a move expected to pave the way for tax rises.
The Guardian revealed in June that Labour was drafting ways to raise money through extra wealth taxes after the election, with changes to CGT and IHT under consideration - measures that could raise up to £10bn. Labour has also said it will clamp down on the "non-domicile" regime, which allows people to live in the UK and not pay tax on their overseas income.
This story is from the July 26, 2024 edition of The Guardian.
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This story is from the July 26, 2024 edition of The Guardian.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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