Remember the time when Lewis moved out of the UK and to Monaco or was it Switzerland? I can’t recall now but he moved and that had server fans in the UK a little nonplussed with the 4-time champion and they called him a tax exile.
The BBC has posted a story about the new Paradise Papers and the people discovered within them avoiding taxation. The BBC said:
“Formula 1 champion Lewis Hamilton avoided tax on his £16.5m luxury jet, according to Paradise Papers documents.
They show a £3.3m VAT refund was given after the Bombardier Challenger 605 was imported into the Isle of Man in 2013.
It appears a leasing deal set up by advisers was artificial and did not comply with an EU and UK ban on refunds for private use – although he may have been entitled to one for business.”
It seems that the UK is ripe with naming and shaming folks this week due to something called the Paradise Papers and Lewis has found himself in the middle of the debate over a VAT refund of over 3 million Pounds. He’s in good company as the Queen has been ensnared in the debate as well.
“If private usage of the jet is being disguised as business usage of the jet, then what you essentially have is a tax avoidance scheme,” says Rita De La Feria, professor of tax law at Leeds University.
“You’re using it for your own private interests, you’re going on holidays, meeting friends. You’re supposed to pay the tax on private consumption.”
If you’re anything like me, then you’ve seen wave after wave of social media posts over the years of Lewis sitting on top of his private jet, standing near it and otherwise hopping all around the world to hang out with friends and have a great time. It would seem those trips are meant to have a tax paid on them and perhaps the allegation is that Lewis hasn’t been doing so.
It’s a very convoluted process and the below graphic from the BBC tries to explain how Lewis worked the system for the VAT refund.
It seems that Lewis has a paper company, Stealth, that leases the jet to Stealth Aviation (if I have the facts correctly) and it all get cloudy from there to be honest. What we do know is that the BBC does a decent job of unpacking how all this tax avoidance works and let’s be honest, that’s not a bad strategy for a kid off a couch in Stevenage. I wonder if there is still a kid left in Stevenage that owns, oh…I don’t know, maybe an old Vauxhall and maybe they could open a company on the Isle of Man and get a few quid back for the trouble?
Check the link out below for all the muddy details on how Lewis does it. Let’s be honest, if there’s a loophole, someone is going to take advantage of it. The problem is that it may not be illegal but it very well could take serious liberties with the intent of the law and process. I’m just disappointed that he didn’t call his paper companies, Roscoe and Coco.
There’s a reason most drivers moved out of the UK throughout their career, the high tax rate. Is it a shocker that Lewis would take advantage of a system to reduce his expenses? No. Is it viewed favorably by the rest of the UK? I’ll leave that up to the folks in the UK to decide. I know I don’t look half as good in my Timberland’s sitting on top of my jet so there is that small detail.
Hat Tip: BBC