A delayed Panorama investigation into the billionaire Barclay brothers will claim that London's Ritz hotel - one of the jewels in the crown of the twins' property portfolio – has not paid any corporation tax since it was acquired by them 17 years ago.
The BBC documentary, which was deferred from broadcast by former director general George Entwistle, is due to be aired tonight after it was given the go-ahead by the corporation's acting boss and will focus on the tax affairs of Sir David and Sir Frederick Barclay and their companies.
The programme will highlight the case of the Ritz, which is one of the capital's most prestigious hotels and made a profit of £6.7m in 2010. The BBC said an analysis of the Ritz's accounts shows it has used tax reliefs to reduce its corporation tax bill to nothing while also reinvesting profits.
There is no suggestion there is anything illegal in the arrangement but Panorama said a zero corporation tax bill was in contrast to the pursuit by another Barclay business, catalogue company Littlewoods, of a VAT rebate from the HMRC potentially worth £1bn.
The publicity-shy brothers, who also own the Telegraph newspaper titles, told the BBC that they are now not involved with the day-to-day running of the UK companies after retiring to the tax haven of Monaco 20 years ago.
In a statement, Sir David said: "We have not attended office, management or board meetings in the UK since leaving the country. My brother and I have no editorial, political or economic power in the UK." Sir David's son, Aidan Barclay, who manages the UK businesses, said the HMRC had publicly acknowledged it took tax incorrectly from Littlewoods, adding its directors had a legal duty to recover the company's money.
Aidan Barclay said the hotel had not paid dividends to its shareholders and profits had been reinvested: "The Barclay family abide by the law and pay the taxes required by UK law."
The five-star Ritz, opened in 1906 by Switzerland's César Ritz – "king of hoteliers, and hotelier to kings" – is estimated to be worth at least £625m, having weathered the downturn with improved turnover and profits.
Stephen Boxall, Managing Director of The Ritz said: “In response to claims in the media regarding non-payment of corporation tax, I reiterate a previous statement by our owning company that The Ritz is a reputable and law-abiding business and pays the taxes required by UK law.
“Since the Hotel was acquired in 1995, in excess of £50 million has been spent on refurbishment, whilst maintaining the standards of excellence and quality. These costs are lawfully off-settable against trading profits. During the period since 1995, The Ritz has not paid dividends to its shareholders.”