Nadhim Zahawi releases statement to address ‘confusion over finances’ after tax revelations

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Nadhim Zahawi has released a statement on recent ‘confusion about his finances’ in which he has failed which to address details of a reported ‘million pound’ fine to the taxman.

The Tory party chairman is under pressure after it was claimed he paid a penalty of more than £1m to settle a probe into his tax affairs.

The former chancellor released a statement saying his father took founder shares in YouGov and that HMRC later “disagreed about the exact allocation”, leading him to “settle the matter and pay what they said was due”.

He does not address reports of a penalty or how much he was fined to settle any probe into his tax affairs amid mounting questions over his personal payments to HMRC.

He said: “As a senior politician I know that scrutiny and propriety are important parts of public life. Twenty-two years ago I co-founded a company called YouGov. I’m incredibly proud of what we achieved. It is an amazing business that has employed thousands of people and provides a world-beating service.

“When we set it up, I didn’t have the money or the expertise to go it alone. So I asked my father to help. In the process, he took founder shares in the business in exchange for some capital and his invaluable guidance. Twenty one years later, when I was being appointed chancellor of the exchequer, questions were being raised about my tax affairs. I discussed this with the Cabinet Office at the time.

“Following discussions with HMRC, they agreed that my father was entitled to founder shares in YouGov, though they disagreed about the exact allocation. They concluded that this was a ‘careless and not deliberate’ error.

“So that I could focus on my life as a public servant, I chose to settle the matter and pay what they said was due, which was the right thing to do.

“Additionally, HMRC agreed with my accountants that I have never set up an offshore structure, including Balshore Investments, and that I am not the beneficiary of Balshore Investments. This matter was resolved prior to my appointments as chancellor of the duchy of Lancaster and subsequently chairman of the party I love so much. When I was appointed by the Prime Minister, all my tax affairs were up to date.”

The news that Mr Zahawi was forced to pay the penalty – part of a reported total tax settlement of almost £5m – comes as The Independent revealed he tried to gag this newspaper from revealing that he was being investigated by the National Crime Agency and HMRC last year.