Rishi Sunak earned £2.2 million and paid £508,000 in tax, documents show

The Prime Minister published a summary of his tax affairs on a Friday afternoon while MPs were on holiday.

Sophie Wingate
Friday 09 February 2024 19:48 GMT
Prime Minister Rishi Sunak has revealed his tax returns (Hugh Hastings/PA)
Prime Minister Rishi Sunak has revealed his tax returns (Hugh Hastings/PA) (PA Wire)

Rishi Sunak has published his tax documents, showing that he paid more than £500,000 in UK tax last year, as his total income rose to £2.2 million.

The Prime Minister released the summary of his tax affairs on Friday afternoon as the House of Commons was in recess.

Critics pointed out that he paid the same effective tax rate as a teacher despite raking in millions more.

The statement showed he paid £508,308 in tax in the financial year 2022/23.

Mr Sunak made nearly £1.8 million through capital gains – up from £1.6 million in 2021/22 – as well as £293,407 in other interest and dividends.

All of the investment income and capital gains came from a US-based investment fund listed as a blind trust, according to the summary.

He also earned £139,477 from his MP and prime ministerial salaries, a sum that made up just 6% of his total income.

The Tory leader’s total income was up 13% from the previous year, rising from nearly £2 million to £2.2 million.

It takes his total earnings over the last four years to about £7 million.

He paid an overall tax rate of only about 23% of his annual income in 2022/23, because most of his earnings were in the form of capital gains, which is taxed at a lower rate than income.

Mr Sunak vocally backed the slashing of the top rate of capital gains tax from 28% to 20% by the Tory Government in 2016.

Our tax system is rigged in favour of the super-rich. It's time to make them pay their fair share!

Labour MP Richard Burgon

Tax expert Dan Neidle said: “What devious planning did he use to pay so little tax? Absolutely none. Most of that £2.3m is in the form of capital gains, and we tax capital gains on shares at only 20%.”

Robert Palmer, executive director at Tax Justice UK, said: “At the moment someone who earns most of their money from their wealth – like the Prime Minister – pays a much lower tax rate than someone who relies on going out to work for their living. We need to fix this to make sure that income from wealth is taxed at the same rate as income from work.”

Labour MP Richard Burgon posted on X, formerly Twitter: “Our tax system is rigged in favour of the super-rich. It’s time to make them pay their fair share!”

Rather than a full tax return, No 10 published “a summary” of Mr Sunak’s UK taxable income, capital gains and tax paid over the last tax year as reported to HM Revenue & Customs, prepared by accountancy service Evelyn Partners.

The former California resident separately paid 6,847 US dollars in tax from 45,646 US dollars of dividends that were taxed separately in the US in 2022.

Mr Sunak and his wife, Akshata Murty, the daughter of the billionaire co-founder of Indian IT giant Infosys, have a combined wealth estimated at about £529 million, according to 2023’s Sunday Times Rich List.

The former investment banker and hedge fund manager has faced accusations of being out of touch with the British public struggling with the cost-of-living crisis due to his vast wealth.

Those criticisms were renewed this week when he accepted a £1,000 bet with broadcaster Piers Morgan over the success of the Government’s Rwanda asylum scheme before the election.

But last month he hit back at critics, saying he “worked really hard for everything that I’ve got” and that those using his wealth as a “political smear” lacked ambition for the country.

Chancellor Jeremy Hunt, whose tax summary was also published, paid a total of £117,418 in UK tax in 2022/2023.

His total income before tax was £416,605, including £27,370 in rental income.

Commenting on the Prime Minister’s tax return, Sarah Coles, head of personal finance at investment platform Hargreaves Lansdown, told the PA news agency: “Rishi Sunak would have had a much bigger tax bill if he was working to generate all of this income, rather than putting his wealth to work for him – because capital gains are taxed at a much lower rate than income.

“His investment income will have suffered from the slashing of the capital gains tax and dividend tax allowances last April – and they’ll suffer again this April when the allowances are cut again. For a man with so much wealth, he’d be forgiven for not being able to tell the difference. However, for investors with more typical portfolios it will be a bitter blow.”

Labour leader Sir Keir Starmer is expected to follow Mr Sunak’s example by publishing his tax return.

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