Nigel Farage uses private company to reduce tax bill. Ukip leader diverts money from media appearances and lectures into a firm called Thorn In The Side Ltd
The Ukip leader diverts money from appearances in the media and on the lecture circuit into a firm called Thorn In The Side Ltd.
It means that last year he paid only 20% corporation tax on profits of £45,000, instead of 40% income tax.
Farage has previously criticised people who try to avoid tax as the ‘common enemy’.
The details of his tax affairs emerged on Mail Online ahead of his live TV debate with Lib Dem leader Nick Clegg.
The use of personal service companies is not illegal, but has been criticised across the political spectrum as a way to reduce tax bills.
Companies House records show that in 2012-13 Thorn In The Side Limited made a profit of £45,488.
If this had been declared as income he would have paid £21,883.03 in 40% income tax and national insurance.
But by using Thorn In The Side as a personal service company, he will have only paid £9,097.60 in corporation tax, plus taxes on his dividend.
As an MEP, Farage also earns £78,000-a-year from Brussels and employs his wife Kirsten on the taxpayer, on a salary of up to £20,000.
Thorn In The Side Ltd was incorporated in 2011 and Farage is the only director, owning 100 per cent of shares.
Last year Farage was branded a ‘hypocrite’ after admitting he opened an offshore trust fund to slash his tax bill while campaigning against tax avoidance.
He set up a scheme on the Isle of Man for ‘”inheritance purposes” but later claimed he never used it, adding: “It was a mistake. I’m not rich enough.”
The BBC has faced criticism for allowing star presenters to have their wages paid into such companies, which means they end up paying less tax. Ukip did not respond to telephone calls asking for a response.