Exclusive: Schroders executive Massimo Tosato ends controversial dual employment contract
The second highest paid director at the FTSE 100 investment giant Schroders has quietly ended a controversial dual employment contract after The Independent revealed that the unusual structure could save him huge amounts of tax.
Massimo Tosato, executive vice-chairman at the fund manager, was paid a total of £4.1m last year and £3.3m in 2012.
The London-based Italian had two employment contracts: one for his UK and international duties, and one for his international duties alone. Such dual employment contracts can allow foreign executives to claim some of their earnings in countries that levy a lower rate of income tax. The Treasury closed the loophole last month in a move that it hopes will raise £270m a year.
According to Schroders’ recent annual report, Mr Tosato’s contract “covering certain of his international duties” has been ended after nearly 12 years. The report states that the contract ended “during 2013”, although when The Independent first disclosed his unconventional arrangements two weeks before Schroders’ financial year end on 31 December, the company confirmed that the two contracts were still operating.
A spokesman said last week: “Schroders’ remuneration committee reviews remuneration arrangements for senior employees at the end of the year. Mr Tosato’s contract related to his international duties ended as a result of the changing nature of his role as he has dedicated more time to group activities and strategy and not in response to any matters external to the company.”
The company, and Mr Tosato, have never commented on his tax affairs, or how much of his £3m to £4m a year pay has been going through his first or second employment contract. It has also never disclosed in which jurisdiction his second contract is held.
Coincidentally, Mr Tosato became embroiled in a minor political scandal in Italy over tax in 2012 when details emerged of a property deal involving him and the government minister in charge of clamping down on tax avoidance. It appeared the minister had registered in official documents a far lower purchase price than the mortgage he took out. The minister denied this was to reduce his tax bill on the purchase, saying he had made an extra payment to a member of the Tosato family for work done on the property.
There was no suggestion of wrongdoing on Mr Tosato’s part. A Schroders’ spokeswoman said on his behalf that the transaction had been “legal and above board”.
- 3 The enemy within: People who hear voices in their heads are being encouraged to talk back
- 4 British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Asteroid narrowly scrapes past Earth: how to watch the closest space rock for decades as it flies by
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Prince Philip set to be knighted by Australia: Celebrate by reading his greatest gaffes
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
30,000 reasons why the rhetoric on immigrants claiming benefits can stop now
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...