Down a back alley in Brighton you will find the rusty dirty nameplate of the backstreet accountancy firm that advises Ken Livingstone on how to arrange his tax affairs. Peter Auguste & Co advertise that they specialise in “tax planning”. The same firm audited the company accounts that Ken has today finally admitted in an LBC interview [below] were used to minimise his personal income taxes.
A change in Ken’s line brought about by the ridicule from even Labour allies about his hypocrisy on taxes. He now justifies his cynical tax planning on the basis that
“I’ve employed three people since I left office. For three years, my wife who typed my autobiography, a good economist who worked out how we can cut fares and a woman to handle my media.”
He told Marr on Sunday that he paid the economist to cost his policies for his campaign and told Nick Ferrari that the third staffer handles his media for the campaign. These are effectively corporate donations to his Mayoral campaign that have to be declared to the Electoral Commission. They have not been declared.
HMRC, under the Companies Act 2006, has strict rules on the tax deductibility of political donations, not least of which being that shareholders have to approve them and it is a requirement that the firm keeps records of such decisions for ten years.
Guido will bet that no such records have been kept and no such formal authorisation was obtained. In fact as a director Ken signed off the company accounts prepared by Peter Auguste & Co. saying the exact opposite:
Ken can’t have it both ways, if he used company funds to pay his campaign staff – as he told Andy Marr and Nick Ferrari – that is clearly a related party transaction if there ever was one. The political campaign staff’s payments should be properly declared to HMRC as a political donation, which should also have been declared to the Electoral Commission as a benefit in kind. Why are all these records missing? Is he telling the truth or making it up as he goes along? The hypocrisy of Ken manipulating his taxes for political advantage and attacking others for not paying taxes is beyond parody. There is always a smell around Ken’s campaign finances..