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| Comedian Jimmy Carr: I've made terrible error over tax | |
| (40 minutes later) | |
| Comedian Jimmy Carr says he has "made a terrible error of judgement" over using a tax avoidance scheme. | Comedian Jimmy Carr says he has "made a terrible error of judgement" over using a tax avoidance scheme. |
| In a statement on his Twitter account, Mr Carr said he was no longer involved in the K2 tax shelter. | In a statement on his Twitter account, Mr Carr said he was no longer involved in the K2 tax shelter. |
| Prime Minister David Cameron on Wednesday called Mr Carr's use of the scheme "morally wrong". | Prime Minister David Cameron on Wednesday called Mr Carr's use of the scheme "morally wrong". |
| The tax scheme is a way of lowering the amount of tax paid. It is legal and Mr Carr made clear in his statement it was fully disclosed to HMRC. | The tax scheme is a way of lowering the amount of tax paid. It is legal and Mr Carr made clear in his statement it was fully disclosed to HMRC. |
| In a series of messages on Twitter Mr Carr said: "I appreciate as a comedian, people will expect me to 'make light' of this situation, but I'm not going to in this statement. | In a series of messages on Twitter Mr Carr said: "I appreciate as a comedian, people will expect me to 'make light' of this situation, but I'm not going to in this statement. |
| "As this is obviously a serious matter. I met with a financial advisor and he said to me 'Do you want to pay less tax? It's totally legal'. I said 'Yes'." | "As this is obviously a serious matter. I met with a financial advisor and he said to me 'Do you want to pay less tax? It's totally legal'. I said 'Yes'." |
| "I now realise I've made a terrible error of judgement. | "I now realise I've made a terrible error of judgement. |
| "Although I've been advised the K2 Tax scheme is entirely legal, and has been fully disclosed to HMRC (Her Majesty's Revenue and Customs). | "Although I've been advised the K2 Tax scheme is entirely legal, and has been fully disclosed to HMRC (Her Majesty's Revenue and Customs). |
| "I'm no longer involved in it and will in future conduct my financial affairs much more responsibly. Apologies to everyone. Jimmy Carr." | "I'm no longer involved in it and will in future conduct my financial affairs much more responsibly. Apologies to everyone. Jimmy Carr." |
| More than 1,000 people, including Mr Carr, are thought to be using the Jersey-based K2 scheme, which is said to be sheltering £168m a year from the Treasury. | More than 1,000 people, including Mr Carr, are thought to be using the Jersey-based K2 scheme, which is said to be sheltering £168m a year from the Treasury. |
| Under the K2 scheme, an individual resigns from their company and any salary they subsequently receive is paid to an offshore trust. | |
| Treasury minister David Gauke told BBC Radio 4's Today programme that he did not think that the scheme would necessarily work, saying he thought HMRC (Her Majesty's Revenue and Customs) might be able to recover the tax avoided. | Treasury minister David Gauke told BBC Radio 4's Today programme that he did not think that the scheme would necessarily work, saying he thought HMRC (Her Majesty's Revenue and Customs) might be able to recover the tax avoided. |
| 'Unfair' | |
| He said he "welcomes the decision" by Mr Carr, whose tax arrangements were revealed by The Times newspaper on Tuesday. | |
| According to the newspaper, the Jersey-based K2 scheme enables members to pay income tax rates as low as 1%. | |
| The prime minister was asked about Mr Carr's arrangement on Wednesday during a visit to Mexico for the G20 summit. | |
| He told ITV News the comedian's tax affairs were "straightforward tax avoidance" and it was unfair on the people who pay to watch the comic perform that he was not paying his taxes in the same way that they did. | |
| "I think some of these schemes - and I think particularly of the Jimmy Carr scheme - I have had time to read about and I just think this is completely wrong. | |
| "People work hard, they pay their taxes, they save up to go to one of his shows. They buy the tickets. He is taking the money from those tickets and he, as far as I can see, is putting all of that into some very dodgy tax avoiding schemes. | |
| "That is wrong. There is nothing wrong with people planning their tax affairs to invest in their pension and plan for their retirement - that sort of tax management is fine. | |
| "But some of these schemes we have seen are quite frankly morally wrong. The government is acting by looking at a general anti-avoidance law but we do need to make progress on this. | |
| "It is not fair on hard working people who do the right thing and pay their taxes to see these sorts of scams taking place." | |
| Investigation | |
| Liberal Democrat deputy leader Simon Hughes said it was "completely unacceptable" for stars to avoid paying proper rates of tax. | |
| But Labour leader Ed Miliband opted not to join in with the chorus of criticism of the Eight Out of 10 Cats star's tax affairs. | |
| He said: "I'm not in favour of tax avoidance obviously, but I don't think it is for politicians to lecture people about morality. | |
| "I think what the politicians need to do is - if the wrong thing is happening - change the law to prevent that tax avoidance happening." | |
| Mr Carr, who has satirised "fat cat" bankers, is reported to protect £3.3m a year from tax by channelling cash through the K2 scheme, which is under investigation by HMRC. | |
| The comedian is thought to be one of more than 1,000 beneficiaries who shelter some £168m from the taxman each year using the company. |