'Disbelief' as Barclays picks up 5.7m tax bill owed by boss Bob Diamond
22:05 GMT, 10 March 2012
Barclays shareholders this weekend expressed bewilderment at the revelation the bank paid 5.7million to cover a tax bill owed by chief executive Bob Diamond.
'Disbelief': The 5.7m reimbursed Diamond after he was required to move from America to Britain last year to become boss
But bank sources said one reason the sum was so high was because it had to pay ‘tax on the tax’. The sum reimbursed Diamond after he was required to move from America to Britain last year to become boss.
Because of the move, a capital gain he had made on some assets was caught by the tax authorities in both countries.
Diamond’s contract specifies Barclays will cover any double taxation caused by a move for his job.
A leading shareholder said: ‘The
principle of this is something I can just about accept, but when it
comes up with such a large number it begs a lot of questions.’
Barclays sources indicated the figure
was so high, partly because it would have had to cover the tax
liability on the payment itself at Britain’s top rate of 50 per cent. This meant for every 1 of Diamond’s tax the bank had to pay, it had to grant about 2 to cover the tax on the payment itself.
Tax benefit aside, Diamond was paid
6.3million, according to the annual report. But including the tax
benefit and share awards from previous years that he received in 2011,
his total earnings have been estimated at more than 25million.
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