Was Rishi Sunak’s in-laws’ company a ‘beneficiary’ of a UK-India trade deal?

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A Facebook post claims that when the UK government struck a £1bn trade deal with India, the main beneficiary was Infosys, the company “owned by the wife and family of Rishi Sunak”.

In May 2021, the government announced £1 billion of “new trade and investment between the UK and India” made by a number of UK and Indian companies. This included the creation of over 6,500 new jobs in the UK.

The government also announced an “enhanced trade partnership” between the two countries, which essentially indicated an intention to work towards a free trade agreement and to reduce certain non-tariff barriers.

While Infosys has been touted as making one of the largest investments, creating 1,000 jobs in the UK and tapping BP to decarbonise the company’s 11 campuses in India, it’s odd to describe Infosys as a “beneficiary” of its own investment.

The term appears to imply that the company will indirectly benefit from a “trade deal” between the UK and India. What really happened was just Infosys spending its own money to invest in the UK.

The Enhanced Trade Partnership outlines the fight against specific non-tariff barriers, although it is unclear which Indian and British companies will be the main beneficiaries.

The UK government has described lowering barriers to trade in fruit, medical devices, education and legal services, none of which appear to directly benefit Infosys, a multinational IT and consultancy.

Infosys was founded in India by Rishi Sunak’s father-in-law, NR Narayana Murthy and Mr. Sunak’s wife, Akshata Murty, is a major shareholder in the company.

Following news that Ms Murty has not paid UK tax on her overseas income from the business, misinformation about Infosys has proliferated on social media. We have previously written about false claims that the company is registered in Rwanda.

What is a no-dom?

The Facebook post also claims the Chancellor’s wife ‘lives in Downing Street while claiming to live overseas for tax purposes’.

Rishi Sunak and his wife Akshata Murty previously lived in Downing Street, but Ms Murty is believed to have moved to their west London home, while Mr Sunak will split his time between the two.

Whilst it is correct that Mrs Murty is a non-domiciled (or ‘non-dom’) resident for tax purposes and lives in London, being treated as a non-dom for tax purposes does not mean that you claim to live in abroad, such as the Facebook post claims.

According to the UK government, being undomiciled refers to “British residents who have their permanent residence (‘domicile’) outside the United Kingdom”.

If someone is a non-dom and their overseas income is over £2,000, they can choose to pay UK tax on that income or claim the ‘remittance basis’. This means they only pay UK tax on foreign income they bring into the UK. This is an active choice that non-doms pay for. Ms Murty paid £30,000 a year to claim the installment basis.

She has since told the BBC that she will pay UK tax on all of her worldwide income, including dividends and capital gains. We wrote more about its previous tax status here.

Image courtesy of Her Majesty’s Treasury.

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