When George Osborne released the rather shortened version of his latest tax return this week I cast it a quick glance, not expecting for a moment it would lead me on a down the rabbit hole type journey that would consume every spare minute I had. Surely nobody really finds this stuff interesting, not even accountants? How hard can it be to do a few sums, it must be a short exercise when armed with PC and trusty calculator?
Here I am 4 days later, having not done nearly as much of my real day job work as I should have. What I am left with is questions. A whole jumbled-up mess of the bloody things. I’m sat thinking how to present these questions, how to sex up the world of company accounts enough to keep your interest until the end. Here goes…
£44,647. The figure on Gideon’s tax return as dividend earnings. The register of MPs interests confirms this must all have been from the family business, Osborne & Little. I had read an article previously that had mentioned a dividend payment of around £1,200 on the Chancellor’s shareholding, so this piqued my interest enough to have a look on Companies House. The company paid out dividends of £335,000 in their 2014/2015 financial year. The annual return confirmed George Gideon Osborne holds 6,833 shares out of a total of 1,989,029, or 0.034% of the business. The calculator is holding up well at this point.
0.034% of £335,000 = £1,150.84
Oh bugger. I’m £43,496.16 short. Trying again didn’t solve it. More maths.
£335,000 / 1,989,029 = £0.16842 per share
£43,496.16 / £0.16842 = 258,260 shares. He must have another 258,260 shares in this Family Trust he makes passing mention to. Hold on, so he’s got 265,093 shares really. That’s (presses buttons furiously on calculator) 13.3% of the business! Quite an interest then.
Having also seen in recent news articles Osborne & Little hadn’t paid corporation tax in 7 years, I wondered how they had managed to pay dividends. Now I’m no accountant but I know dividends are based on profit. It turned out that they did pay £179,000 corporation tax in 2014/15. What has baffled me is the apparent refund in tax in 2013/14. A whopping £599,000, made up of £158,000 fixed asset timing differences and £440,000 tax losses. Cue frantic googling.
Thanks to a rather convoluted tax system combined with a lack of explanation on the company accounts, I’m still not sure on the how or why, but I do have a shocking headache and some sympathy for anyone who works in accountancy.
What I have achieved so far are some questions for our Chancellor.
How exactly is your shareholding in Osborne & Little made up?
Why are the majority of your shares not in your own name?
Have Osborne & Little been in receipt of any government grants, subsidies or tax breaks in the past five years?
What does the £599,000 relate to; in detail and in layman’s terms? (We’re not daft, but we’re not forensic accountants.)
Yours neither sincerely nor faithfully