HM Revenue and Customs has concludedan agreement to move tax officials to a new office complex at Newcastle owned by major conservative party donors through an offshore company based in a paradise fiscal, may reveal the Guardian.
The new house planned by the department in north-east England is part of a developed regeneration scheme by a British Virgin Islands entity (BVI) controlled by billionaire real estate tycoons David and Simon Reuben.
The deal will see officials from the ministry responsible for preventing tax evasion work on goir from a site owned by a subsidiary of a company based in a secret offshore tax jurisdiction.
The Reuben brothers, their family members and their companies have donated a combined £ 1.9million to the Tories. Earlier this week, the brothers are reported sharing a table with Boris Johnson at an exclusive Conservative Party fundraising dinner.
Officials Tuesday , which Cabinet Office Minister Steve Barclay announced HMRC had entered into a 25-year lease with one of the companies in Reuben brothers.
The brothers are the second richest family in the UK, selon Sunday Times Rich List . David Reuben's son, Jamie, is a close ally of the Prime Minister and has served as the Conservative Party's treasurer. He has donated over £ 750,000 to the party since Johnson entered Downing Street.
The Reuben family have established a significant presence in Newcastle in recent years years and is part of the Consortium controversial Saudi-led which acquired Newcastle United football club in October.
Documents filed by the company show that the family has frequently used BVI companies to maintain its UK interests, which include a luxury property portfolio in London and a series of racetracks.
A spokesperson for HMRC said the Newcastle office complex is owned and will be developed by a UK company, Reuben Brothers (Newcastle) Limited. However, documents filed by Companies House show that the sole shareholder of the company when incorporated earlier this year was Taras Properties Limited in BVI.
Taras Properties first acquired the site in 2013 and transferred ownership of the land to the UK company in June this year for £ 10million, according to land registry records. BVI has several large plots of land in central Newcastle, in the area surrounding the planned HMRC offices.
A spokesperson for the Reuben brothers confirmed that the UK company is owned by Taras Properties, but insisted that the subsidiary "operates and pays taxes as a UK company". The HMRC spokesperson insisted that the Reuben brothers' company would be subject to normal UK tax regulations. "Lease payments and all gains on sale are subject to UK tax," they said. “HMRC is convinced that the deal represents the best value for the taxpayer.
There is no suggestion of wrongdoing on the part of the Reuben brothers and of owning property in UK via offshore companies is perfectly legal.
But the government's decision to relocate 9,000 HMRC employees to the site comes as it faces calls to honor a commitment for introduce a register of foreign companies owning property in the UK. The bill, publie for the first time in 2018, is designed to crack down on the use of offshore companies to hide the identity of owners and their source of funds.
Fight Offshore tax evasion and avoidance are described as a top priority for HMRC and earlier this year the department unveiled plans to combat offshore tax evasion by targeting entities based in UK facilitating the sale of evasion schemes using tax havens.
In response to this ruling Dame Margaret Hodge, Labor MP and group chair multi-party parliamentarian on anti-corruption and responsible taxation said: "It is scandalous that HMRC is using taxpayer money for the benefit of someone who relies on offshore structures based intax havens. "