Dear Residents of Epping Forest,I am very sorry that many people here in Epping Forest will have been concerned and upset about the allegation in Saturday’s Daily Telegraph that I have acted wrongly by not paying Capital Gains Tax when I sold my Westminster flat in August 2008.
I have always been scrupulous about the way in which I have carried out my responsibilities as a public servant in spending taxpayers’ money and I am deeply hurt by this attack on my integrity.
I would have paid the tax if it had been due, but it was not due. By last summer, the Westminster flat had, in practical terms, become my main home and therefore, as HMRC rules designate, Capital Gains Tax was not payable when I sold it. My house in Theydon Bois, for which I have never claimed a penny of taxpayers’ money, will be liable for Capital Gains Tax when it is eventually sold.
The criticism occurs because, when I first became an MP, I designated the flat as my “second home” and I did not think of changing that designation when my circumstances changed following the birth of my son and then my divorce.
I had, however, continued to claim the Parliamentary Additional Costs Allowance to help pay the mortgage on the flat. I now realise that this is inconsistent.
I had not planned to sell the flat but financial circumstances following my divorce made this necessary and I used the proceeds of the sale to buy a smaller flat in the same block. Since I moved to the smaller flat in August 2008 I have obviously not claimed any mortgage interest from the Additional Costs Allowance.
I respect the fact that many people who live in Epping Forest travel daily to London while I am fortunate to have a London base as well as a constituency base. From now on I will pay all the costs of my flat, with no help from the taxpayer.
I could explain in detail the legal position and why I have broken no rules, but I fully appreciate that people are fed up with that approach. I care far more about my integrity than about money.
I am uncomfortable with the thought that I may have used taxpayers’ money in a way that is questionable. I have, therefore, decided voluntarily to send £25,000 of taxpayers’ money back to the House of Commons authorities. This is a considerable amount of money so I am talking to my bank about obtaining a loan to enable me to pay it immediately.
I wholeheartedly support David Cameron’s decisive actions to make the system open and clear. I submitted all my expenses claims to the Conservative Party Scrutiny Committee when it was first set up some weeks ago and I will do whatever they might require of me when they have considered the matter.
I understand why there is public anger over the whole issue of MPs’ expenses. The system is dreadful. I have spent my whole working life trying to bring our democratic system into the modern age and to reform Parliament so that it broadly reflects the people it represents. I continue that work daily as Shadow Minister for Justice.
All politicians have a hard task ahead to win back the confidence and to earn the respect of the country. My work on behalf of the people of Epping Forest will continue to be my first priority.
I am very sorry that all of this has happened but I hope that I have been able to set the record straight.
Yours sincerely,
Eleanor Laing.
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