Rishi Sunak's wife is registered non-domicile in the UK, meaning she may be spared paying millions in UK taxes, it has been revealed. This comes as the Chancellor's 1.25 per cent rise in national insurance payments come into force.
Akshata Murthy, whose family business is estimated to be worth around £3.5bn, could have used the non-dom status over several years to save money on tax. This would include when Rishi Sunak became the Chancellor in 2019, The Mirror reports.
Having non-dom status is not illegal and can be used to save someone from paying UK tax on dividends from foreign investments, rental payments on property overseas or bank interest. Inheritance tax in the UK can also be avoided through this.
A spokeswoman for Ms Murty said she has always paid UK taxes on her UK income but her tax status has caused anger among some, with Labour calling on the Chancellor to 'urgently explain' how much he and his family have avoided due to her non-domicile status. A spokesperson for Ms Murthy said the businesswoman automatically gained non-dom status due to being an Indian citizen.
It is understood the Chancellor registered his wife's non-dom status with the Cabinet Office when he was promoted as a minister in 2018. The Independent reported that Ms Murthy may have saved 'saved millions of pounds over several years'.
Ms Murthy's spokeswoman said: “Akshata Murthy is a citizen of India, the country of her birth and parent’s home. India does not allow its citizens to hold the citizenship of another country simultaneously. So, according to British law, Ms Murthy is treated as non-domiciled for UK tax purposes. She has always and will continue to pay UK taxes on all her UK income.”
The Mirror reports that the Treasury is aware of Ms Murthy's tax status and she will be automatically deemed domiciled after living in the UK for 15 years.
But Labour's shadow economic secretary to the Treasury Tulip Siddiq said: "The Chancellor has imposed tax hike after tax hike on the British people. It is staggering that, at the same time, his family may have been benefitting from tax reduction schemes.
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"This is yet another example of the Tories thinking it is one rule for them, another for everyone else. Rishi Sunak must now urgently explain how much he and his family have saved on their own tax bill at the same time he was putting taxes up for millions of working families and choosing to leave them £2,620 a year worse off."
Dividends from Infosys, the India-based company owned by Ms Murthy's family, calculated from her stake in the company, of 0.93 per cent - worth approximately £725 million based on recent market valuations - suggest the payments could have totalled around £11.6 million in the past year.
Representatives for Ms Murthy insist she has paid foreign taxes on foreign income.
