Bernie Ecclestone avoided potential £1.2 billion tax bill

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Formula 1 boss Bernie Ecclestone has avoided a potential £1.2 billion tax bill as a result of a 'secret deal' with the HMRC, BBC's Panorama has revealed.

The F1 supremo, who is currently standing trial in Germany facing charges for alleged corruption, is said to have dodged the massive tax bill after he settled with Revenue & Customs for just £10 million.

Panorama obtained legal transcripts, which revealed that HMRC had been investigating the Ecclestone family's tax affairs for nearly nine years before settling on the £10 million fixed fee.

The investigation dates back to 1995 when Ecclestone secured the television rights to Formula 1. According to the BBC, he moved this prize asset offshore, giving the rights to his then wife, Slavica.

She transferred them to a family trust in Liechtenstein, before selling them for a huge profit, free of UK tax.

The BBC suggested that this could potentially be the biggest individual tax dodge in British history, although legally watertight provided Mr Ecclestone did not set up, or control, the trust.

Barrister and tax expert Jolyon Maugham said: "I'm certainly not aware of anything else remotely approaching that sort of magnitude, in my fairly extensive experience."

The transcripts, which were taken during an interview with a German public prosecutor, saw Ecclestone family lawyer Frederique Flournoy admit to settling with the Inland Revenue for £10 million.

He said: "In summer 2008, the Inland Revenue offered to conclude the matter if we paid £10 million. We decided to pay up."

According to Ms Flournoy's evidence, the Ecclestone family trusts earn around £10m in interest every six weeks.

Mr Ecclestone says he has always paid his fair share of tax and that he is, "proud to be British and proud to make my contribution by paying my taxes here," according to the BBC.

The Panorama programme airs tonight on BBC One at 20:30