The 90 day a year loophole that Ken Bates exploits may soon come to an end after a courtcase against Robert Gaines-Cooper (another UK tax exile) ruled he should pay UK tax as his main interests lie in this country, despite a move to the tax haven of the Seychelles.

Always ready for a fight

The landmark court case could have a knock-on effect for many football chairman, not least, our very own cuddly Ken, who has been dodging tax for some years now with his millionaire lifestyle in Monaco. The loophole both he and Gaines-Cooper exploit allows them to spend 90 days in the UK tax-free running whatever businesses they like, whilst claiming citizenship in tax-free havens abroad.

Gaines-Cooper’s case will probably be appealed in the Supreme Court, but Ken Bates will be watching from afar, eagerly awaiting the outcome, which will likely bring a whole host of cases against millionaire tax-exiles living abroad from all walks of life, not just football.

Although each case will have to be ruled on an individual level, it’s likely each decision will come from where the majority of each defendants income comes from. In the case of Gaines-Cooper, the majority of his personal income comes from within the UK, so the court therefore decided he should be made to pay tax to the sum of £30,000,000 on this.

Ken Bates is likely to face a similar problem as Leeds United (to my knowledge) is his only remaining business interest so it would be impossible to argue his income comes from anywhere other than the United Kingdom.

So, what does this mean for Leeds United? Probably very little as it would be personal to Ken Bates’ own tax-bill. Whether he would increase the salary he takes from the club to continue funding his current lifestyle and to pay the back dated bill is probably our only concern. For Ken Bates however, it could be mean a massive tax bill, followed by 40% of earnings (soon to be 50%) thereafter.

I wouldn’t expect anything to happen too soon mind, as the legal world and HM Revenue & Customs will be waiting for the result of any Gaines-Cooper appeal whose landmark case will likely set a precedent for future ones. If the ruling does stand in the Supreme Court, HM Revenue & Customs will likely start action against people like Ken Bates, but are bound to face strong opposition from the million and billionaires teams of lawyers.

Happy for Bates to stay on under new majority owner?

View Results

Loading ... Loading ...