Zahawi urged to explain source of £26m mystery loans

theguardian.com:

The chancellor Nadhim Zahawi is under pressure to explain the source of £26m of unsecured loans reported by his family property firm in 2018 as he faces questions over his tax affairs.

The millions of pounds of loans helped Zahawi and his wife buy properties across Britain, including commercial and retail premises in London, Birmingham, Brighton and Walton-on-Thames in Surrey.

The Observer has established that new loans to the property firm Zahawi and Zahawi were reported in the same year that an offshore family company linked to the chancellor sold shares in YouGov, the polling firm he founded, transferring £26m to an unknown recipient or recipients.

A source close to Zahawi insisted there was no link between the money transferred out of the offshore firm, Balshore Investments, and the unsecured loans to his family property firm, Zahawi and Zahawi.

A spokesman said: “Nadhim and his wife have never been beneficiaries of any offshore trust structures.”

The chancellor is embroiled in a mounting controversy after the Observer revealed last week that a “flag” has been raised by officials over his financial affairs. He is facing calls to identify the lender or lenders who helped finance his property firm.

Zahawi, who was eliminated from the Conservative party leadership race on Wednesday, said last week he always paid his tax and he was ready to answer any questions after reports he was under investigation by HMRC. The chancellor has said he has not been informed of and is not aware of any investigation.

Zahawi, 55, forged his career as a businessman by co-founding the polling and market research firm YouGov in 2000. Tax experts are however baffled over why he was not initially allocated any shares in the firm, despite being one of