We’re starting to think that these £5 million backhanders really aren’t all they are cracked up to be. The money Nigel Farage received from the crypto billionaire Christopher Harborne has caused him nothing but trouble – and it could now also end up putting Reform out of pocket.
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The gift that keeps on giving… Nigel Farage nightmares
Three individual sources have told The Guardian that the 61-year-old held discussions with senior Reform figures just a few months before the 2024 election, explicitly stating he would need £1 million a year to ‘cover his losses’, should he serve as an MP over a five-year term.
Farage is reported to have been concerned about missing out on other earnings, specifically his GB News gigs, which pay him around £98,000 per month. The undeclared donation was then made by Harborne just a few weeks later. Team Farage have not denied the allegations at the time of writing.
Tax experts change view on HMRC involvement
So, why does all this matter? Well, the context around Nigel’s decision to run for office is crucial, according to experts at Tax Policy Associates (TPA). They previously did not believe the donation would face any scrutiny from HMRC – but the pre-Harborne conversations now paint a different picture.
As per their updated article, TPA believe that ‘disguised remuneration’ rules would apply if this arrangement actually took place. Dan Neidle, founder of the group, now believes ‘there is a high risk’ that Reform could be taxed up to £3 million on the dubious payment.
“The Guardian report that Nigel Farage told senior figures in Reform UK in March 2024 that he would need ‘a million a year’ to cover lost earnings if he stood for Parliament, and that resuming the leadership of Reform through the 2024 and 2029 elections would cost him £5m.”
“If the £5m was paid as part of that arrangement, then the analysis changes materially. In our view, the ‘disguised remuneration’ rules would probably apply, resulting in about £3m of PAYE and National Insurance liabilities which would, in the first instance, fall on Reform Ltd rather than on Mr Farage.” | TPA
Nigel Farage produces ‘another distraction’ for Reform
Nigel Farage is having a torrid time as the media spotlight continues to intensify. He’s also been accused of receiving funds from convicted wire-fraudster George Cottrell, with doubts raised about the legitimacy of his donations. However, the initial £5 million remains the talk of Westminster.
Rounding off their analysis, TPA explain that the goalposts have likely shifted, as the so-called gift could now be connected to intentions of working. With Reform also reportedly losing their lead in the voting intention polls this week, the going is getting tougher for the turquoise rosettes.
“A gift unconnected to your work is (as a general matter) otherwise not taxable in the UK. If there is a connection to your work (past, present or future), and it’s strong enough, then you will be taxed on it in the same way as your work is taxed.”
“The significant new element is the report that senior Reform figures were involved in discussions about compensating Mr Farage for returning as leader.” | TPA