Nadhim Zahawi’s tax affairs: What did the Conservative Party chairman do?

Published

3 years ago

January 25, 2023

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The chairman of the Conservative Party, Nadhim Zahawi, is currently under investigation over his multimillion-pound tax dispute.

On Monday, Prime Minister Rishi Sunak asked new ethics adviser Sir Laurie Magnus to assess whether the cabinet minister breached the ministerial code with the HMRC settlement he made while he was chancellor.

“Clearly in this case there are questions that need answering,” he told reporters.

Mr Zahawi has said he is “clearly being smeared” over questions about his tax affairs – and that he did not “benefit” from an “offshore trust”.

Mr Sunak is under increasing pressure to remove Mr Zahawi from his senior cabinet post.

But what do we know about the matter so far?

Who is Nadhim Zahawi?

Mr Zahawi, the chairman of the Conservative Party, was previously an aide to Conservative peer Lord Archer and – with another aide Stephan Shakespeare – founded polling company YouGov at the turn of the millennium.

In 2010, setting his sights firmly back on politics, he became MP for Stratford-upon-Avon.

He secured his first junior minister post – education minister – in 2018, but became a household name after COVID broke out in the UK and he was appointed by former PM Boris Johnson as vaccine minister.

‘Game over’ for Zahawi – politics latest

The performance propelled him to cabinet and in September 2021, he took his first secretary of state post, back in the Department for Education.

He was propelled further to chancellor in the dying days of Mr Johnson’s premiership after the resignation of Rishi Sunak.

Mr Zahawi made an unsuccessful bid to become PM following Mr Johnson’s removal – losing out to Liz Truss – but was appointed Chancellor of the Duchy of Lancaster.

He became chairman of the Tory Party just weeks later when Ms Truss’s premiership came crashing down and Mr Sunak gained the keys to Number 10.

What is the controversy about?

In January 2023, The Sun On Sunday published a report claiming Mr Zahawi had paid a seven-figure sum to settle a dispute with HMRC over the sales of his YouGov shares.

The shares, worth an estimated £27m, were held by Balshore Investments, a company registered offshore in Gibraltar linked to Mr Zahawi’s family.

Sky News understands that, as part of a settlement with HMRC, Mr Zahawi paid a penalty to the tax collector.

The exact size of the settlement has not been disclosed, but it is reported to be an estimated £4.8m, including a 30% penalty.

By Monday, Mr Sunak had ordered a potentially far-reaching investigation into Mr Zahawi to be conducted by the PM’s new ethics adviser Sir Laurie Magnus.

Sir Laurie is expected to focus on whether the cabinet minister breached the ministerial code with the estimated £4.8m HMRC settlement he made while he was chancellor, but it could extend to his prior tax arrangement and whether he lied to the media.

It is unclear what the prime minister knew about Mr Zahawi’s dealings with the tax office when he appointed him to his cabinet in October.

Sources close to Mr Zahawi have said he is “absolutely not standing down”.

What has Zahawi said?

Last July, it was reported that HMRC was investigating Mr Zahawi’s tax affairs – but a spokesperson for him at the time said he was “not aware of any formal investigation by HMRC” and insisted “his taxes are fully paid and up to date”.

The next day, allegations arose that concerns had been raised by officials over Mr Zahawi’s tax affairs before his appointment as a minister in Mr Johnson’s cabinet.

When the issue of his tax affairs came up in an interview with Sky News as Mr Zahawi prepared to launch his leadership bid, Mr Zahawi said: “I was clearly being smeared.

“I was being told that the Serious Fraud Office, that the National Crime Agency, that HMRC are looking into me. I’m not aware of this.”

It is unclear when Mr Zahawi first knew about the probe by HMRC, but his allies have said he told the Cabinet Office’s propriety and ethics team about the matter before his appointment.

Over the weekend, Mr Zahawi said HMRC concluded there had been a “careless and not deliberate” error in the way the founders’ shares, which he had allocated to his father, had been treated.

In a statement on Monday, following the PM’s announcement of an investigation into the matter, he added: “I am confident I acted properly throughout and look forward to answering any and all specific questions in a formal setting to Sir Laurie.”

Mr Zahawi has not confirmed how much his penalty amounted to or the value of the overall settlement with HMRC.

What has the prime minister said?

The prime minister has ordered his ethics adviser to investigate whether Mr Zahawi broke ministerial rules over the estimated £4.8m bill.

A week ago, Mr Sunak told MPs that Mr Zahawi had “already addressed the matter in full” – but Downing Street subsequently revealed the PM had not been aware that the Conservative Party chairman had paid a penalty to HMRC as part of the settlement.

Mr Sunak admitted there are “questions that need answering” as the inquiry was launched, and it is unclear what he knew when appointing Mr Zahawi to the cabinet-attending role.

Downing Street subsequently suggested Mr Sunak did not know last week that Mr Zahawi had paid a reported 30% penalty to HMRC.

Probed on the matter by Labour leader Sir Keir Starmer at PMQs on Wednesday, the PM said: “The issues in question occurred before I was prime minister.

“With regard to the appointment of the minister without portfolio, the usual appointments process was followed, no issues were raised with me when he was appointed to his current role, and since I commented on this matter last week, more information has come forward.

“That is why I have asked the independent adviser to look into the matter.

“I obviously can’t prejudge the outcome of that but it is right that we fully investigate this matter and establish all the facts.”

Mr Sunak has so far resisted growing calls to remove Mr Zahawi from his current post.

Who has called for him to go?

Former minister Caroline Nokes said there were “too many unanswered questions” over the tax row as she called for Mr Zahawi to “stand aside and let the investigation run its course”.

Speaking to Sky News on Tuesday, Lord Hayward agreed that the Tory Party chairman should think about “standing aside” while parliament’s ethics watchdog investigates his tax affairs.

“We don’t know what the timescales are for the inquiry, and I think that’s key,” he said.

“I think he should be considering whether he stands aside for the period of the inquiry.”

But Home Office minister Chris Philp said on Monday that Mr Zahawi should be treated as “innocent until proven guilty” and it is “reasonable” for him to continue as party chairman.

“The investigation has been launched by the prime minister; that is the right thing to do. It will get to the bottom of this and then the prime minister will make his decision,” he said.

“But I don’t think it is fair to jump to any conclusions before the investigation has concluded.”

Labour said Mr Zahawi’s admitted carelessness should see him removed from government.

Shadow foreign secretary David Lammy told Sky News: “When you’ve been chancellor of the exchequer and you said you’ve been careless despite the fact that offshore trusts have been set up in Gibraltar, I’m sorry, you really ought to resign or be sacked.”

What does this mean for the PM?

The Zahawi tax affairs saga formed one of two controversies Mr Sunak has been forced to confront this week, with questions also being raised over the decision to appoint Richard Sharp as BBC chairman while he reportedly helped former Number 10 incumbent Mr Johnson secure a loan of up to £800,000.

The PM has also distanced himself from this allegation, saying the chairman’s appointment was made by “one of my predecessors”.

But these two incidents add to what has been a turbulent first few months in Number 10 for Mr Sunak.

On his first day as PM in October, Mr Sunak vowed to restore “integrity and accountability” to government – a promise which has now been called into question by a series of events.

A few days after entering Number 10, the PM was forced to defend re-appointing Suella Braverman as home secretary days after she quit over data breaches.

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Labour leader Sir Keir Starmer accused the new PM of doing a “grubby deal” with Ms Braverman to secure her support in the Tory leadership contest.

An independent probe was also launched into the conduct of another cabinet member – Deputy Prime Minister Dominic Raab – after he was subject to multiple complaints of bullying.

Mr Sunak initially stood by the justice secretary – who he reappointed to the role in the autumn – but eventually bowed to pressure to allow the formal probe.

On top of this, the prime minister received a second police fine last week, this time for failing to wear a seatbelt.

The first was received last year after he broke coronavirus rules during the partygate scandal.

World

‘Nervous’ British tourists in Jamaica tell of Hurricane Melissa ordeal

Published

14 hours ago

October 29, 2025

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'Nervous' British tourists in Jamaica tell of Hurricane Melissa ordeal

Up to 8,000 holidaying British citizens are in Jamaica as it is battered by one of the strongest Atlantic hurricanes in history.

People have been ordered to stay indoors as Hurricane Melissa sweeps over the Caribbean island, which is also home to 50,000 dual nationals.

And tourists are locked down in hotels as Jamaica is hit by 185 mph winds.

Follow latest updates on Hurricane Melissa

Andrew Tracey had been due to fly home to the UK on Monday, but his flight was cancelled.

Mr Tracey told Sky News that food packages were being delivered to guests at his hotel. Deck chairs have been removed from the beach, and the swimming pools have been drained, at the Negril hotel where he is staying.

“The balcony and walls do feel as though they are vibrating just due to the strength of the wind,” said Mr Tracey.

“I’m very nervous, it’s hard to comprehend what we are likely to expect.”

The US National Hurricane Centre in Miami said that Melissa was “one of the most powerful hurricane landfalls on record in the Atlantic basin” as it hit southwestern Jamaica near New Hope.

In a social media post, the centre warned that it is an “extremely dangerous and life-threatening situation” – and told those in the area not to leave their shelter as the eye of the storm passes over.

‘It is a bit scary, but we’ve got each other’

A British-Jamaican couple who are sheltering inside as the storm passes over the island spoke to Sky News about their ordeal.

Shantell Nova Rochester and her Jamaican fiance Denva Wray are due to get married on the island next month.

They spoke of broken windows and water coming in where they are staying, but the couple believe they are “as safe as they can possibly be” in St Elizabeth.

Mr Wray said: “Where we are is quite strong, sturdy, but you can hear a lot of wind. It is a bit scary, but we’ve got each other, so we are strong.”

Asked about the wedding, Ms Rochester said: “We’re just worried about getting through tomorrow, but that’s a worry in the back of our heads.

“Where we’re plan to get married is flooded at this time.”

Government action ‘too late’ – British tourist

One British man who paid £3,500 for last-minute flights so he and his family could return home before the hurricane hit the island said that he felt “completely let down” by the government’s response.

David Rowe and his family, from Hertfordshire, had spent 10 days in Jamaica before deciding to fly back to the UK on Saturday.

Mr Rowe, 47, was critical of the response of the Foreign, Commonwealth and Development Office (FCDO).

Speaking to the PA news agency, IT manager Mr Rowe said: “It’s all too late, their reaction and their response to the storm has been too late – after the fact.

“The advice should have been last week, like on the Saturday – don’t travel – because a lot of the travel companies use the FCDO guidance on travel (for) all their planning and what decisions they make as an organisation.

“There should have been something done much sooner than this. A lot of the UK nationals, and people on holiday there, they are stranded.

“This could have been prevented with with better action from the UK government.”

Mr Rowe added that he and his wife had felt “very anxious” before they flew home – and “very sad” for those left in the country.

A Foreign Office spokesperson said: “We understand how worrying developments in Jamaica are for British nationals and their families.

“Our travel advice includes information about hurricane season, which runs from June to November. Last Thursday we updated our travel advice for Jamaica to include a warning about Tropical Storm Melissa and that it was expected to intensify over the coming days.

“The safety and security of British nationals is our top priority, and that is why we are urging any British nationals in Jamaica to follow the guidance of the local authorities and register their presence with us to receive updates.”

World

Blasts reported after Benjamin Netanyahu orders Israeli military to carry out ‘powerful’ strikes in Gaza

Published

14 hours ago

October 29, 2025

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Blasts reported after Benjamin Netanyahu orders Israeli military to carry out 'powerful' strikes in Gaza

Blasts have been reported in Gaza after Israel’s prime minister Benjamin Netanyahu ordered his military to carry out “powerful” air strikes.

Witnesses said they saw explosions and heard tank fire in Gaza City and Deir al Balah.

An Associated Press reporter in Deir al Balah heard tanks firing from an area controlled by the Israeli army, and, in Gaza City, two health officials reported strikes, including near the Shifa hospital.

At least two people were killed, and four others wounded, by a strike on a neighbourhood south of Gaza City, according to Gaza’s Civil Defence.

The announcement of strikes came shortly after Israel said that Hamas had opened fire on its forces in southern Gaza on Tuesday.

Hamas has denied involvement in the attack in the city of Rafah. The militant Palestinian group also said in a statement that it remained committed to the US-backed ceasefire deal.

Mr Netanyahu had also accused Hamas of violating the three-week-old ceasefire in the territory by handing over remains that were of an Israeli hostage who was already recovered.

A statement from the prime minister’s office said: “Following the security consultations, Prime Minister Netanyahu instructed the military echelon to carry out powerful strikes in the Gaza Strip immediately.”

US Vice President JD Vance said the ceasefire, which began on 10 October, was holding, telling reporters: “That doesn’t mean there aren’t going to be little skirmishes here and there.

“We know that Hamas or somebody else within Gaza attacked an (Israeli military) soldier. We expect the Israelis are going to respond, but I think the president’s peace is going to hold despite that.”

Hamas on Tuesday said that it would postpone the planned handover of a body of a hostage it had recovered, claiming violations of the ceasefire by Israel.

In a sign of the fragility of the ceasefire, Israeli troops were shot at in Rafah, and returned fire, according to an Israeli military official.

An Israeli military official told Sky’s Middle East correspondent Adam Parsons that Hamas have “shown their true face”.

The official told him: “Hamas violated the ceasefire once again, carrying out an attack against IDF forces east to the yellow line, an area under Israeli control.

“This is yet another blatant violation of the ceasefire. This comes after Hamas has also shown their true face and the fact that are pretending to not know where the remaining hostages are.”

Hamas said on the Telegram messaging app that any Israeli escalation of attacks in Gaza would hinder search and recovery operations, and delay the return of the bodies of Israeli soldiers.

There are thought to be 13 bodies of hostages still in Gaza.

Speaking to Sky News, Israeli government spokesman David Mencer said: “The first line of this agreement is that all of our hostages should have been returned on the first day of this agreement.

“They were supposed to give back all of our hostages, and there was supposed to be a ceasefire. There are still 13 of our murdered hostages (in Gaza).

“And secondly, Hamas are firing on our troops. That is not a ceasefire.”

After the ceasefire took effect, all 20 living hostages were freed in exchange for almost 2,000 Palestinian prisoners, but the remains of the dead have been slow to be repatriated.

Hamas has said there are problems finding them due to a lack of equipment to sift through the devastation and rubble in Gaza.

The search for hostage bodies had been stepped up over the past few days after the arrival of heavy machinery from Egypt.

Bulldozers were working in Khan Younis, and further north in Nuseirat, with Hamas fighters deployed around them.

Some of the bodies are believed to be in Hamas’ network of tunnels below Gaza.

World

Eleven people killed after tourist plane crashes in Kenya

Published

14 hours ago

October 29, 2025

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Eleven people killed after tourist plane crashes in Kenya

Eleven people have been killed after a plane carrying tourists to a Kenyan safari reserve crashed.

According to officials, the aircraft burst into flames and was reduced to charred wreckage at the hilly and forested area in which it crashed.

The plane had been travelling from Diani Airport, on the coast, to the Maasai Mara National Reserve.

The dead included eight Hungarian passengers, two Germans and the Kenyan pilot. There were no survivors.

Authorities initially said the crash happened at 5:30am local time. Later, the Kenyan transport minister gave the time of the incident as 8:35am.

Kenya’s ministry of roads and transport said the aircraft was destroyed by the impact of the crash and an ensuing fire.

Investigators from the country’s aircraft accident investigation department have been deployed to the site to begin an inquiry, they said.

The department added that the Kenyan government’s “highest priority” remains aviation safety.

In a statement, John Cleave, the chairman of Mombasa Air Safari, said “our hearts and prayers” were with all those affected by the crash.

He wrote that the company had activated its emergency response team and was “fully cooperating” with the relevant authorities, who have already begun investigating.

“Our primary focus right now is on providing all possible support to the families affected,” Mr Cleave continued, adding that a family assistance team had been established to offer counselling, logistical coordination and any required assistance to the relatives of the victims.

The Maasai Mara National Reserve is a two-hour direct flight from Diani, a popular coastal town known for its sandy beaches.

The reserve attracts a large number of tourists as it features the annual wildebeest migration from the Serengeti in Tanzania.

Hungarian Prime Minister Viktor Orbán wrote on social media on Tuesday that his foreign ministry had been in contact with authorities in Kenya concerning the Hungarian victims of the plane crash.

He said: “What a tragedy! Our sincere condolences to families of the Hungarians who died in the plane crash in Kenya.”