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Taxpayers foot the bill for Kent county councillors' unpaid tax

Just 15 councillors have volunteered to pay back tax that Kent County Council paid on their behalf - out of your money.

Taxpayers’ cash was used to cover £179,000 worth of unpaid tax that councillors should have paid on their travel expenses.

The council paid the taxman the six-figure sum on behalf of 94 members who, HMRC ruled, were liable for tax on their trips from home to County Hall.

Paul Carter has been criticised for his 'glass ceiling' remarks. Stock picture
Paul Carter has been criticised for his 'glass ceiling' remarks. Stock picture

The settlement was reached after a prolonged three-year wrangle with HMRC, which focused on the issue of whether councillors should have been paying tax on their journeys to and from County Hall.

KCC argued elected members were not liable to pay tax on these expenses but HRMC rejected this and issued the authority with a bill to cover a four-year period.

But rather than members paying their bills, the county council paid it on their behalf, using taxpayers’ money to do so.

However, it put in place arrangements so councillors could voluntarily re-pay what they owed.

To date, fifteen unnamed councillors have opted to use those arrangements and have re-paid £10,600 - just under 6% of the total - leaving £168,400 outstanding.

The £10,600 consists of £6,100 that has already been paid while the remainder is being paid back in installments.

HMRC could force businesses to file quarterly tax information
HMRC could force businesses to file quarterly tax information

In a response to a Freedom of Information request made by the KM Group, the authority said: “This issue has affected 94 past and present members. Many of those members will still be considering their position and some will be taking advice as to what option best fits their own situation in each of the tax years in question, given that each year may well be different.”

The tax bill is made up £167,000 in tax plus a further £12,000 interest.

County councillors receive a basic allowance of £12,805 and are eligible to claim mileage at 45 pence a mile if travelling on official council business.

In 2013-14, councillors received £113,479 in travel expenses.

In a twist to the saga, the Treasury has now reversed the tax policy, saying councillors’ travel expenses will be exempt from income tax and National Insurance contributions.

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