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Formula 1 boss Bernie Ecclestone has dodged more than £1 billion in tax thanks to a secret deal with HM Revenue and Customs, BBC Panorama claimed yesterday.
The billionaire, who has serially courted controversy, paid just £10 million to settle the deal, according to legal documents obtained by Panorama.
HMRC spent nine years probing the Ecclestone family’s tax affairs before the token payoff in 2008.
The Panorama probe went back to 1995, when Ecclestone got the TV rights to Formula 1. Shortly afterwards he moved the deal offshore and handed them over to his then wife Slavica.
She transferred them to a family trust based in Liechtenstein before selling them for an enormous profit, without paying any tax in Britain.
The BBC said: “It may be the biggest individual tax dodge in British history, and is legally watertight provided Mr Ecclestone did not set up, or control, the trust.”
Ecclestone has admitted that he could have faced a tax bill of £1.2bn if he had controlled the trusts.
HMRC does not comment on individual cases but Panorama uncovered transcripts of interviews conducted by the German public prosecutor with lawyers who ran the family trusts.
Frederique Flournoy told the prosecutor: “In summer 2008, the Inland Revenue offered to conclude the matter if we paid £10m. We decided to pay up.”
That figure was equivalent to just six weeks of interest on the trusts’ assets, Ms Flourney revealed.
Ecclestone gave up his fortune to avoid inheritance tax, meaning he can’t legally receive any payments from the trusts.
But Ms Flourney said the racing mogul was still receiving “around $100m (£60m) a year” from his divorce settlement.
Ecclestone said his tax affairs were a “private matter” but he was “proud to be British and proud to make my contribution by paying my taxes here.”
A lawyer for the trusts claimed there were errors in the transcripts of the German interviews.
F1 chief executive Ecclestone is currently on trial for allegedly bribing a bank official.
Prosecutors claim the £26m bung was paid to ensure Ecclestone kept control of the sport.
The 83-year-old said he was effectively blackmailed because he feared banker Gerhard Gribkowsky would tell tax authorities that he’d set up an offshore family trust.
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