Lord Sainsbury said last night that he had reshuffled his stake in the grocer founded by his family in advance of changes to capital gains tax (CGT) that come into effect on Saturday, according to The Guardian.
The move saves the former Labour science minister and Sainsbury’s boss about£27 million in extra tax he would have had to pay on the sale of his shares. It follows similar reshuffles by former Morrisons chairman Sir Ken Morrison, who is understood to be considering transferring his£1 billion-plus shareholding to relatives and appointing new trustees ahead of the CGT changes.
However, in Sainsbury’s case, the ultimate effect is not to avoid an additional contribution to the HM Revenue & Customs. According to The Guardian, because Lord Sainsbury has made clear his intention to gradually distribute his wealth to philanthropic causes, any payment of CGT on the sale of his assets can be clawed back by those charities receiving donations. Nevertheless, the Labour peer is understood to have acted in order to keep greater control over the pace of his charitable share sales.
Lord Sainsbury has reshuffled shares in Sainsbury’s, worth about£340 million, placing£92 million into an investment vehicle that he owns called Innotech Advisers and passing a further£8 million over to his Gatsby Charitable Foundation.
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