Paradise Papers | F1 champion Lewis Hamilton set up company in Malta

Lewis Hamilton implicated in the Paradise Papers as documents show he holds a company in Malta for 'image rights' and a £3.3 million VAT refund was given when his Bombardier Challenger 605 was imported

Lewis Hamilton (Photo: the Independent)
Lewis Hamilton (Photo: the Independent)

Lewis Hamilton, the Formula One world champion, reportedly avoiding paying European taxes on his private jet, using an Isle of Man scheme.

The law firm at the core of the Paradise Papers, EY and Appleby aided Hamilton, as well as many others, set up artificial leasing businesses, through which they were able to rent jets for their own use.

“No one seems to be enforcing the laws that exist,” said Rita de la Feria, chair of tax law at the University of Leeds.

Paradise Papers documents show a £3.3 million VAT refund was given after the Bombardier Challenger 605 jet was imported into the Isle of Man in 2013.

Just a kid from the UK that had a dream. #YouCanDoItToo #NeverGiveUp #TeamLH #MegaJet #RoadtoAbuDhabi #AbuDhabiGP

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The Guardian also reported that he holds a company in Malta, 44IP, with the company's stated purpose being to hold "image rights... trademarks, royalties, copyrights', as of March 2015. 

Its shares were held by Inday Rose Ltd, the BVI company, which ultimately owns his jet. 

"The purpose of 44IP appears to be to channel income from sponsorship deals via Malta, which charges foreign shareholders a 5% corporation tax rate", said the report.

Hamilton’s lawyers said that a tax review found that the structure was lawful and that it was not correct to say that no VAT had been paid on any of the arrangements.

Hamilton claimed that he had instructed a senior lawyer to check his agreements and that his practice was to rely on professional advice. He was not concerned, he said, with the day-to-day management of his business.

"As a global sportsman who pays tax in a large number of countries, Lewis relies upon a team of professional advisers who manage his affairs.

(Photo: BBC)
(Photo: BBC)

"Those advisers have assured Lewis that everything is above board and the matter is now in the hands of his lawyers”, said a statement issued by Hamilton’s representatives.

The race car driver appears to have used shell companies in the British Virgin Islands, the Isle of Man and Guernsey to avoid the entire VAT bill, which was triggered when he imported the £16.5 million red aircraft into the UK from Canada.

Another Isle of Man company was set up so Hamilton could purchase a €1.7m motorhome, which he uses at racetracks.

No VAT appears to have been paid on that purchase either.

Hamilton denies using shell companies and claims that the Manx entities were a part of his business.