The then-Chancellor was given more than £60,000 by an individual listed in the Paradise Papers
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Embattled Conservative Party Chairman Nadhim Zahawi’s 2022 Conservative leadership campaign was backed by an investment manager linked to the offshore tax haven of Bermuda, Byline Times can reveal.
Zahawi received £62,500 from Khaled Saïd – representing the full amount that appears to have been received by Zahawi’s campaign, launched after Boris Johnson announced his resignation as prime minister in July 2022.
Saïd is the managing partner of Capital Generation Partners – a firm which, in its own words, “look[s] after large pools of capital for families, endowments and individuals”. This includes helping families to “preserve and grow” their wealth, assisting families with their real estate portfolios and their investment decisions.
Saïd is personally listed in the Paradise Papers – the leak which, in 2017, revealed the links between various high-profile individuals, firms, and offshore tax havens. The Paradise Papers link Saïd to 18 companies based in the tax haven of Bermuda, listing him as a shareholder of three, a director of 12 and a signatory for three – though not all are still trading in the country.
One of the subsidiaries of Capital Generation Partners, as listed in its annual accounts and featured in the Paradise Papers, is a firm called Capital Generation Partners Bermuda Limited, based in the British Overseas Territory.
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Bermuda imposes no taxes on profits, income, dividends, or capital gains – allowing companies to minimise their liabilities. In 2012, US multinational corporations reported more profits in Bermuda than in Japan, China, Germany and France combined, according to Oxfam, which listed Bermuda as the world’s ‘worst’ tax haven in 2016 – though this ranking was disputed by the country’s government. Saïd and Capital Generation Partners say that they pay full UK tax – registering their income in the UK to do so.
Zahawi has faced intense scrutiny in recent days over his own tax affairs, having been forced to cough up £4.8 million in the form of unpaid taxes and penalty charges. The controversy in particular surrounds his family’s alleged use of an offshore trust. Zahawi denies any wrongdoing.
‘Careless Not Deliberate’
Khaled Saïd is the son of Wafic Saïd, the Syrian-born financier who brokered a multi-billion pound arms deal between Saudi Arabia and the UK in the mid-1980s – at the time the biggest arms agreement ever signed by the UK.
Wafic Saïd reportedly had close ties to both the Saudi royal family and Margaret Thatcher’s Government – allowing him to broker the contract. In 2001, Saïd told the Sunday Telegraph that the deal “brought a huge boost to British industry: you are talking about thousands of jobs. But for some reason, which I cannot understand, the press want to portray this as a shady, mysterious deal… Due to my extensive contacts in Saudi Arabia, I played a very small role: the big role was played by Lady Thatcher.”
Saïd admitted that he indirectly benefited from the deal, “because the project led to construction in Saudi Arabia that involved my companies.”
Wafic and his wife, Rosemary, have donated substantially to the Conservative Party over recent decades – Wafic donating at least £350,000 during Thatcher’s premiership, and Rosemary donating more than £1.8 million to the party since 2015.
Wafic Saïd’s family investment company – Saïd Holdings Limited – is based in Bermuda, having been incorporated there in 1994. Capital Generation Partners is listed as one of the two principal investment partners of Saïd Holdings.
It is entirely lawful to set up a company through a country like Bermuda, and there are a number of other non-tax benefits to such arrangements, including privacy.
Khaled Saïd told Byline Times that he and Capital Generation Partners pay full UK tax.
“We onshore our profits from our Bermuda subsidiary in order to do so,” he said. “We are not technically required to onshore those profits, but we are clear in our moral and financial obligation to do so given that we benefit from UK infrastructure.”
He added that some international clients ask for Capital Generation Partners to contract with them in an offshore jurisdiction, which “is their prerogative”.
“We pay UK tax on any income that we accrue from any business we conduct in all jurisdictions,” he reiterated. “The same goes for me personally; I pay the full extent of taxes on all my income. I am a resident in the UK, and I pay all my taxes in the UK regardless of where or how the tax arises. For the avoidance of doubt, I do not claim non-domicile status for UK income tax purposes.”
The Conservative Party, Nadhim Zahawi, and Saïd Holdings have also been approached for comment.
It is notable, however, that Nadhim Zahawi received substantial funds for his leadership bid from an individual linked to a tax haven, given recent controversies surrounding Zahawi's own tax affairs.
Zahawi has recently reached a settlement with HMRC regarding unpaid tax, with the bill – including a penalty charge – being £4.8 million. The allegations centre on Zahawi's links to an offshore, Gibraltar-based trust called ‘Balshore Investments Limited’, previously linked to the polling company YouGov, which Zahawi co-founded.
Zahawi has described the tax error as “careless and not deliberate”, while Prime Minister Rishi Sunak has ordered an investigation from his ethics advisor into the affair. Zahawi maintains that he and his wife have not and do not benefit from an offshore trust.
Boris Johnson appointed Zahawi as Chancellor following Sunak’s resignation from the position in July 2022. It’s understood that Zahawi finalised his agreement with HMRC while he was Chancellor.
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