Sunak defends wife’s tax status as Labour and No 10 deny leak

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The chancellor, Rishi Sunak, has defended his wife after revelations that she claims non-domiciled status, meaning she does not legally have to pay tax in the UK on her income earned abroad.

The businesswoman Akshata Murty, estimated to be worth hundreds of millions of pounds, is an Indian citizen and is reported to hold a 0.91% stake in Infosys, an IT business founded by her father.

Her share is thought to be worth £11.5m a year, meaning she may have avoided up to £20m in UK tax by being non-domiciled in the UK. Murty has said she pays tax overseas.

Sunak told the Sun newspaper: “She loves her country like I love mine,” and said his wife had done nothing wrong in choosing a financial arrangement that legally exempted her from paying tax in Britain on foreign income.

Asked whether he blamed Labour for what he called awful smears against his family, Sunak replied: “Yeah.” A report in the Times suggested unnamed allies of the chancellor had claimed the prime minister’s office were behind the leaks – an allegation No 10 and No 11 strongly denied.

A Treasury source told the Guardian: “It is categorically not true that Rishi or anyone else in his team believe this is coming from No 10.”

A No 10 spokesperson told PA Media: “It is categorically untrue that No 10 is behind the briefings. The prime minister and chancellor are united.”

Sunak told the Sun that Murty was entitled to use the “non-dom” arrangement as she was an Indian citizen and planned to move back to her home country to care for her parents.

On Wednesday, Murty claimed the non-dom status was given to her automatically as an Indian citizen. But tax experts have said she must choose to seek the status each year. Murty pays £30,000 a year for having non-domiciled status, her spokesperson confirmed. The status will automatically cease once she has resided in Britain for 15 years, with her due to reach that milestone in 2028.

The chancellor said it was “unpleasant” to read attacks on his wife “especially when she hasn’t done anything wrong”. “She hasn’t broken any rules. She’s followed the letter of the law,” Sunak told the Sun.

He said she “pays full UK tax on every penny that she earns here in the same way that she pays full international tax on every penny that she earns internationally”.

He said he would never dream of asking his wife to give up Indian citizenship for the sake of his political career.

He added: “I would hope that most fair-minded people would understand – though I appreciate that it is a confusing situation, that she is from another country.”

He added: “These are her choices, right? She’s a private citizen, and of course I support my wife’s choices. She’s not her husband’s possession. Yes, he’s in politics, and we get that, but I think, you know, we get that she can be someone independent of her husband in her own right.”

The Labour leader, Sir Keir Starmer, said on Thursday that Sunak could be guilty of “breathtaking hypocrisy” if his wife was reducing her own tax bill as the No 11 incumbent increased national insurance for millions of Britons.

Murty confirmed her non-dom status after the Independent website first reported the arrangement on Wednesday – the day the 1.25-percentage-point rise in national insurance took effect.

It means her permanent home is considered to be outside the UK despite the Sunaks living in Downing Street.

Source: The Guardian

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