Lewis Hamilton had come under the spotlight in 2017 for tax avoidance charges. Let’s understand how the Mercedes driver got into this.
The Paradise Papers leak in 2017 sent shock waves around the world. It names celebrities and VIPs across the board. Some notable names include Queen Elizabeth, Harry Potter fame Emma Watson, and closer home Amitabh Bachchan and Vijay Mallya.
Formula One was not to be left behind, with legends Fernando Alonso and Lewis Hamilton also alleged to have committed tax fraud.
Also Read: Lewis Hamilton net worth in 2020
The latter’s tax fraud case revolves around a private luxury jet he bought – a Bombadier Challenger 605.
The Lewis Hamilton tax fraud case
Lewis Hamilton bought the jet from a company in the British Virgin Islands. It cost him 16.6 million pounds. His financial advisers Ernst & Young (EY) and Appleby then came into the picture. EY was in the centre of the Paradise Papers controversy.
The tax law firms helped Hamilton lease the jet to a ‘new’ company on the Isle of Man, considered a tax haven. Interestingly, this company was owned by the man Hamilton himself. It doesn’t stop here.
The Bombardier is then leased out to a management firm, which claims it ‘charters’ the plane to the British driver.
This elaborate leasing structure helped Hamilton to secure a VAT refund over 3 million from the Isle of Man.
Lewis Hamilton defended himself; claimed it was done lawfully
According to leading British dailies, Hamilton did not act on it himself. He was simply following the advice handed out by Ernst & Young, and Appleby. His lawyers also clarified that the process is lawful, and it has been review by a tax barrister in the UK.