Lord Sugar, the business mogul and star of the popular reality TV show “The Apprentice,” has found himself at the centre of a financial whirlwind involving a hefty tax bill of £186 million.
In an attempt to sidestep a substantial tax bill, Lord Sugar was reported to have applied for non-residency in the United Kingdom. The concept of non-residency implies that the concerned individual doesn’t reside in the UK and spends less than 90 days in the country annually. This status would have allowed Lord Sugar to avoid the UK tax on a massive dividend of £390 million that he received from his company in the 2021-22 fiscal year.
The intriguing turn of events came to light when a joint investigation was conducted by The Sunday Times and the Bureau of Investigative Journalism. The investigation unravelled Lord Sugar’s attempt to argue that he wasn’t based in the UK during the time in question, as he had spent a significant portion of the year in Australia. The business tycoon was hosting the Australian version of the ‘Celebrity Apprentice’ show during this time.
Interestingly, Lord Sugar seemed to be unaware of a crucial detail that would ultimately foil his attempts to claim non-residency. As a member of the House of Lords, Lord Sugar was automatically considered a resident of the UK, regardless of his physical location throughout the year. This detail was apparently overlooked by Lord Sugar when he applied for non-residency.
Despite Lord Sugar’s efforts to avoid the tax payment, HM Revenue and Customs (HMRC), the UK’s tax collection agency, required him to pay the entire £186 million. This tax was due on the enormous £390 million dividend that Lord Sugar had drawn from his company in the 2021-22 tax year. The payment made by Lord Sugar is reported to be one of the largest tax bills paid in the country for that year.
The revelation that his membership in the House of Lords made him ineligible for claiming non-residency reportedly caught Lord Sugar by surprise. Allegedly, Lord Sugar stated that he would have resigned from the House of Lords had he known that his membership would prevent him from claiming non-residency.
Around the same time that HMRC would have reviewed his status, Lord Sugar took an unexplained leave of absence from the House of Lords. This leave lasted from January to June. However, it’s important to note that there is no provision in the law for those who temporarily leave the chamber to claim non-residency.
In an interesting twist to the story, Lord Sugar blamed his tax advisers for the oversight and is reportedly taking legal action against them to recover his loss. This move indicates that Lord Sugar believes he was poorly advised and that his advisors should bear the brunt of the mishap.
Lord Sugar has a history of being vocal about his stance on tax evasion and has repeatedly made statements condemning those who dodge taxes. Despite the recent incident, Lord Sugar’s spokesperson confirmed that Lord Sugar is a UK tax resident and that all his income has been taxed on the basis of his UK residency.