Richard Tice's property company failed to pay approximately £91,000-£120,000 in tax due to what he calls a minor administrative error or technicality. The company used a REIT (Real Estate Investment Trust) status, meaning it paid no corporation tax between 2018 and 2021, avoiding nearly £600,000 in tax. According to The Sunday Times, the company failed to pay withholding tax on dividends on at least three occasions between 2020-2021.
Quidnet REIT Limited was a REIT from 10 September 2018 to 9 August 2021, according to research from two sources. As a UK REIT, Quidnet was required to distribute at least 90% of its tax-exempt property rental profits to shareholders as Property Income Distributions (PIDs). REITs are exempt from corporation tax during a grace period and must deduct withholding tax from dividends. Quidnet REIT Limited was required by law to withhold approximately £120,000 of tax from those dividends and pay it to HMRC, according to research from two sources.
Richard Tice paid the correct tax, suggesting he might have slightly overpaid.
Labour has urged HMRC to investigate Richard Tice's tax arrangements. Party chair Anna Turley wrote to the tax authority after The Sunday Times reported Tice had avoided nearly £600,000 in corporation tax through his property company, according to research from two sources. Reform UK describes the tax issue as a minor administrative error.
Reform UK's broader tax stance appears contradictory to the allegations against Tice. Richard Tice claims Reform councils have delivered more than £700 million in savings and imposed lower council tax increases than other parties. He says Reform UK promised to slash waste and keep taxes low, with average council tax increases in Reform-run councils at 3.94%, lower than Labour (4.71%), Lib Dem (5.49%), and Conservative (4.9%). However, Nigel Farage was forced to clarify Reform UK's manifesto pledge to 'Stop the Offshore Taxpayer Rip Off' during a Q&A, according to multiple media reports.
All Britons should do their best to pay the minimum tax possible.
Additional financial arrangements involving Tice's companies have come under scrutiny. According to The Sunday Times, Richard Tice ran four shell companies which did not pay any tax on profits between 2020 and 2022. Between March 2020 and May 2022, Tisun Investments Ltd transferred £1,113,000 to Reform UK, according to multiple reports from major media sources.
Richard Tice has made counter-allegations against Labour in response to the scrutiny. He accused the Labour Party of failing to pay corporation tax on its property company, Labour Party Properties Ltd, for 25 years. According to research from two sources, Labour Party Properties Ltd is a company that buys, sells and lets its own or leased real estate, according to Companies House filing, where its accounts are six months overdue.
Dismissed a Sunday Times investigation into his tax affairs as a smear, claiming the story was misleading.
Several key unknowns remain about the situation. It is unclear whether HMRC has launched or will launch an investigation into Richard Tice's tax affairs. The exact total amount of tax involved remains uncertain, as sources report conflicting figures from £91,000 to nearly £600,000.
Further uncertainties surround the REIT arrangement and potential consequences. Whether Richard Tice's company Quidnet REIT Limited legally qualified for REIT status or exploited a legal quirk remains unclear. It is unknown whether any penalties or back taxes have been or will be paid by Richard Tice or his companies to HMRC.
Criticised the idea that people should 'pay the maximum tax' they possibly could, calling it a road to ruin for the UK economy.
The issue was first identified by Gabriel Pogrund of The Sunday Times, according to research from two sources. Reform leadership has responded defensively to the allegations. According to multiple media reports, Nigel Farage lashed out at a reporter and challenged her to give a lecture on tax law when asked about Richard Tice's tax affairs.
Structural details about REIT compliance requirements provide context for the allegations. Quidnet REIT Limited never attracted more than a small number of outside investors and ceased to be a REIT on 9 August 2021, according to research from two sources. REITs are usually required to be widely held by different investors, with a three-year grace period to become compliant, according to research from two sources.
The tax failure was a 'technicality' and 'overall HMRC received the correct amount of tax due'.
Has refused to answer directly about the tax payment, instead saying he paid income tax on the dividends.
Quidnet Reit Ltd was 'a UK company paying UK tax in accordance with UK laws', adding there was no 'obligation' to pay the maximum tax required.
How many friends of yours would voluntarily choose to pay more tax than they are legally obliged to do?
The idea that morally, we have got to pay the maximum tax we possibly can - therein lies the road to ruin for the UK as an economy.
Yes, within the legal limit. That is what you should do. Don't morally or voluntarily give more tax to incompetent, wasteful hard-left, socialist governments to waste on your behalf.
It appears that no corporation tax has been paid during this period and that the company appeared to have received more than £30m in rental income.