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 £2.2m.
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.
Sunak made nearly £1.8m through capital gains – up from £1.6m 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 six per cent of his total income.
The Tory leader’s total income was up 13 per cent from the previous year, rising from nearly £2m to £2.2m. It takes his total earnings over the last four years to about £7m.
He paid an overall tax rate of about 23 per cent of his annual income in 2022/23, as most of his earnings were in the form of capital gains, which is taxed at a lower rate than income.
Sunak vocally backed the slashing of the top rate of capital gains tax from 28 per cent to 20 per cent by the Tory government in 2016.
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.
“His investment income will have suffered from the slashing of the capital gains tax and dividend tax allowances 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.”
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 per cent.”
Rather than a full tax return, No 10 published “a summary” of Sunak’s UK taxable income, capital gains and tax paid over the last tax year as reported to HMRC, 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.
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 £529m, according to the 2023 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.
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.
Labour leader Sir Keir Starmer is expected to follow Sunak’s example and publish his tax return.
Press Association – Sophie Wingate