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January 26, 2024

Billionaire XTX founder and Bernie Ecclestone lead list of UK’s top taxpayers – stumping up more than £650m each

The two billionaires' bumper payments were revealed by The Sunday Times' annual Tax List, which found most of the UK's wealthiest families were paying less to HMRC

By Rory Sachs

Two billionaires each paid over £650 million to HMRC over the past 12 months, according to the Sunday Times’ list of the 100 top taxpayers in the UK.

Alex Gerko, a ‘maths whizz’ trader who founded XTX Markets in 2015, paid £664.5 million in UK tax over the last year, while the former chief executive of Formula 1, Bernie Ecclestone, paid £652.6 million to HMRC’s coffers.

The chart-topping payment by Gerko, whose algorithmic trading firm works with a host of institutional clients, is the largest ever payment featured in the newspaper’s annual Tax List. It comes off the back of a £1.2 billion dividend he received from the business, of which he owns 75 per cent, and corporation tax (at 20 per cent) on £250 million in profits. The trader also topped the 2023 list from the Sunday paper, paying £487.4 million in tax over the course of 2022.

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Meanwhile, Ecclestone’s bumper payment comes after a decades-long dispute with HMRC, which culminated in him receiving a suspended sentence after pleading guilty to tax fraud. It covers tax, penalties and interest for 18 tax years between 1994 and 2022.

Gerko’s contribution to the taxman equates to £1.8 million per day – or £75,000 per hour. By contrast, the annual tax bill for the average UK resident sits at around £5,000.

‘This represents a tax payment equal to the sum of 132,000 “ordinary” taxpayers,’ leading private client tax lawyer James Quarmby told Spear’s. ‘It shows how pathetically dependent the UK Treasury is on the 0.1 per cent “super-wealthy” taxpayer bracket – many of whom, like Gerko, are non-UK domiciled.’

Breaking down the bumper figure, Quarmby explained that at a tax rate of 39.35 per cent, Gerko’s £1.2 billion dividend from XTX would generate £472 million in income tax alone. ‘Then, they seem to have added on his corporation tax (which of course is not a personal tax) of £250m, so that adds up to £522m, so I guess the rest is from CGT and other earnings,’ Quarmby said.

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[See also: The leading accountants and tax advisers for HNW individuals in 2023]

Falling profits in UK’s largest family businesses behind falling tax take from most UHNWs

In third place, Bet365 founder Denise Coates, along with Peter and John Coates, paid £375.9 million in UK tax, while the Done family, which sits behind the rival gambling behemoth Betfred, paid £204.6 million.

JD Wetherspoon founder Sir Tim Martin and Sir James Dyson came in fifth and sixth place respectively, while the top ten also included the Westons (the family behind Fortnum & Mason), Mike Ashley and John Timpson.

Other famous names in the top 100 include Leonie Schroder, who along with her family paid £62.5 million this year, the Cadogans, JK Rowling, Ed Sheeran and Peter Hargreaves.

Together, the 100 individuals and families on the top taxpayers’ list paid around £5.35 billion in tax – 3 per cent higher than the aggregate figure paid last year. 

But despite the bumper payments at the top, two thirds of those who were featured in the 2023 list – 68 wealthy individuals and families – are now paying less this year.

These 68 names paid £200 million less over the past 12 months than in 2022, which reflects falling profits by their companies and reduced corporate tax take-ins, according to The Sunday Times.

[See also: Will UHNWs exit the UK if the non-dom regime is abolished?]

Top taxpayers like Gerko 'subsidise the rest of us'

'I can’t say why the tax take from the others has dropped, but it could be because the [private equity] market has been pretty dire in the last 12 months, due to the increase in interest rates and a collapse in deals,' Quarmby said. 'For many taxpayers, their tax bill is inflated by large capital gains made on share deals.'

Quarmby also sounded a warning over how potential reforms to the non-dom regime, which have been promised by Sir Keir Starmer if Labour win a majority at the next general election, could further reduce the tax take from the UK's richest UHNWs.

'People like Gerko may leave, or decide not even to come to the UK in the first place, which will lead to a dramatic drop in tax revenues,' Quarmby said. 'What the anti-non-dom campaigners need to realise is that it's people like Gerko who subsidise the rest of us, not the other way around.'

'If you were to believe the Labour propaganda, the non-doms are not "paying their fair share", leaving the ordinary hard-working Brits to pick up the tab. It's actually the opposite.'

[See also: How UK tax changes from this January will affect HNWs]

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