Cameron releases information on tax returns amid row

                                

David Cameron paid almost £76,000 in tax on an income of more than £200,000 in 2014-15, his accounts show.

In a first for a UK prime minister, Mr Cameron released a summary of his tax returns over the past six years as he tried to defuse a row over his financial affairs.

Papers show he was gifted two lots of £100,000 by his mother a year after inheriting £300,000 from his father.

When Ian Cameron died in 2010, the inheritance tax threshold was £325,000.

The prime minster said he was publishing the information to be "completely open and transparent".

On Saturday, he admitted he could have better handled the row over his financial affairs, telling people to "blame me" for this rather than nameless advisors at Downing Street.

In the six years from 2009 to 2015, Mr Cameron earned a total of almost £1.1m and paid about £400,000 in income tax, according to the three-page summary.

Part of his earnings came from rental income from his family home in west London. Last year, Mr Cameron's 50% share of rent, minus expenses, was close to £47,000.

The payments by Mary Cameron to her son in May and July 2011 were given tax free, and will only become liable to inheritance tax of up to 40% if she dies within seven years of handing over the money.

Solicitor Robert Levy, who specialises in tax affairs, told the BBC there was nothing in the papers that made him "raise his eyebrows".

On the matter of the two £100,000 gifts, Mr Levy said: "It's not unusual for parents to make gifts to children. It's just the figures here are larger than they might otherwise be."

Mr Cameron's £300,000 inheritance from his father had been just below the inheritance tax threshold so people "put two and two together and often make five", he said.

It was hard to know if they were in any way connected without more information, he added, "but it didn't look to me that it was something that looked wrong."

Labour leader Jeremy Corbyn said the matter highlighted "a whole ethos" surrounding how the very wealthy handled their tax affairs, adding he would publish his own tax return "very, very soon".

This all comes after a week of questions and successive statements over whether Mr Cameron had owned and sold units in an offshore fund run by his late father, Ian Cameron.

Details of the Blairmore Holdings fund had been contained in a leak of 11 million documents, known as the Panama Papers.

Mr Cameron has announced a new task force to investigate tax-dodging allegations in the Panama Papers.

The figures released by the prime minister show:

• He and his wife Samantha made a £19,000 profit from the sale in 2010 of their shares in the Blairmore Holdings fund
• Mr Cameron declared a £9,501 share of that profit, below the then £10,100 capital gains tax threshold
• Mr Cameron inherited £300,000 when his father died in 2010
• He was later given two payments of £100,000 by his mother in May and July 2011 in an attempt to balance out the legacy between Mr Cameron and his siblings
• In 2014-15, David Cameron paid £75,898 in tax on £200,307 earnings
• On top of his prime ministerial income, and the London rent, he last year received £9,834 in taxable expenses from the Tory party and £3,052 in interest on savings at a High Street bank
• He earned enough to benefit from the 2013 cut in the top rate of tax from 50p to 45p (for people earning more than £150,000)
• In 2010 when he first entered Downing Street, he took the prime ministerial expenses deduction - a £20,000 tax-free allowance - as part of his £142,500 salary
• But he voluntarily cancelled out the allowance by declaring the equivalent amount as taxable income from 2011-12, 2012-13 and 2013-14, before waiving it from 2014-15

Outside the Conservative spring conference on Saturday protesters called on the prime minister to come clean about his financial affairs. Now he hopes he has provided the proof that he has done just that.

David Cameron has produced a summary of his tax affairs, not the full returns. Downing Street says that is to aid clarity and is similar to information other politicians have put in the public domain.

None of the details suggests he didn't pay what was due. There is, however, further proof of his wealth - something which his opponents will hope is a political liability.

And there will be questions over whether income from share dividends which he derived while opposition leader came from other overseas trusts as well as from his late father's investment vehicle.

But while Labour will argue that the prime minister is still too opaque when it comes to transparency, some Conservative politicians worry he has revealed too much.

There may be pressure on other cabinet ministers including the chancellor to go public. And some fear if tax no longer remains a private matter, successful people could be dissuaded from going in to politics.

Addressing the Tories' spring forum on Saturday, Mr Cameron had said he was to blame for the handling of revelations about his investment in the Bahamas-based Blairmore Holdings fund.

"It has not been a great week. I know that I should have handled this better. I know there are lessons to learn and I will learn them," he said.

As he was speaking, hundreds of protesters marched through Whitehall calling on Mr Cameron to "close tax loopholes or resign".

The fund was named in the leak of documents belonging to Panamanian law firm Mossack Fonseca. They revealed Ian Cameron had been a client of Mossack Fonseca when establishing the fund for investors.

The prime minister first promised his tax return data in 2012 but details for the past seven years have now been made public in the wake of the furore over the documents.

BBC political correspondent Carole Walker said the decision to publish the tax returns summary would keep the prime minister's finances in the headlines.

But Downing Street felt the only way to move forward was by confronting the issue head on with an unprecedented level of detail, our correspondent said, adding however that Labour was in no mood to let the row drop.

Labour leader Jeremy Corbyn has committed to publishing his own tax return "very, very soon, when I've got the papers together", insisting there were "no surprises there".

He accused Mr Cameron of misleading people and losing public trust, saying: "It's not about an individual, it's not about one person, it's not about one family.

"It's about a whole ethos where the very rich are able to put their money into tax havens, into offshore accounts where there is often a zero rate of income tax, also sometimes a zero rather of corporation tax."

Shadow chancellor John McDonnell has demanded an "open and public" inquiry into the Panama Papers revelations on offshore funds and tax havens.

The new tax task force announced by Mr Cameron will have initial funding of £10m and involve staff from the Serious Fraud Office and Financial Conduct Authority as well as HMRC and the NCA.

The government said the agencies had leading technology, experts and resources to tackle money laundering and tax evasion.

Shadow chancellor John McDonnell said proposals for the task force to report to the chancellor and home secretary were "unacceptable".

"Any inquiry must be fully independent and in public," he said.

Source: BBC