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Lewis Hamilton avoided of VAT, and his case investigated by UK tax authorities

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Lewis Hamilton avoided of VAT, and his case investigated by UK tax authorities   Lewis Hamilton

News24xx.com -  The Paradise Papers have revealed, if Formula 1 world champion Lewis Hamilton avoided paying Value Added Tax (VAT) on his £16.5million private jet.


The 32-year-old man received a £3.3million refund for the Bombardier Challenger 605, which was imported into the Isle of Man.

Any private jet purchased outside the European Union is subject to 20% VAT, in order to move freely around the continent.


Under United Kingdom and European Union (EU) legislation he would have been entitled to a VAT rebate on the jet if it be used purely for business purposes. However, documents suggest that around a third of Hamilton's journeys were for private trips.


Hamilton's lawyers said there had been no illegal activity, but admitted no VAT had been paid on the plane.

The Mercedes star's social media account shows him using the plane to jet off to holidays across the globe, while he has also posed on board with his two bulldogs, Roscoe and Coco.

The accountancy firm EY and Appleby, the law firm at the centre of the Paradise Papers leaks, helped Hamilton and others set up seemingly artificial leasing businesses through which they rented their own jets from themselves.

Files leaked from Appleby suggest as much as £1.1m of the VAT he appears to have reclaimed on his jet should have been paid, along with hundreds of thousands due on the continuing costs of flying the jet.

The aircraft is now registered to a Hamilton company in the Virgin Islands, which in turn leases it to another in the Isle of Man, which in turn rents it to a screen company in Guernsey.

They said his practice was to rely on professional advice, and he was not concerned with day-to-day management of his business, according to investigators working for the France 2 TV Channel.

Hamilton set up another Isle of Man company to buy a £1.5m motorhome that he used at racetracks, and no VAT appears to have been paid on that purchase either.
Legitimate tax avoidance schemes are legal, and there is no suggestion Hamilton was directly involved in creating the scheme used for his jet.

 

Hamilton left the United Kingdom to live in Monaco and then Switzerland in 2007, so as to avoid paying excessive UK tax.

This year’s Sunday Times Rich List put his personal wealth at £131 million.


Rita De La Feria, professor of tax law at Leeds University, told : 'If private usage of the jet is being disguised as business usage of the jet, then what you essentially have is a tax avoidance scheme. You're using it for your own private interests, you're going on holidays, meeting friends. You're supposed to pay the tax on private consumption.'

 

 

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