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Ken Dodd has last laugh in smart tax move

Ken Dodd, one of Britain’s best known comedians sadly died last weekend.  He will be remembered as one of the greatest variety performers. Before he died Ken may have had the last laugh at the expense of the tax man.

Ken had not always had a happy relationship with HMRC.  In 1989 he stood trial at Liverpool Crown Court on eight charges of tax fraud.  HMRC alleged that the fraud had taken place over a 15 year period and involved £825,000.  Apparently, £336,000 cash was hidden in wardrobes, cupboards and under stairs. In addition, it was stated he had a total of 20 bank accounts in Jersey and the Isle of Man where he would take “cash and carry” flights to deposit money the tax man knew nothing about.  Ken was acquitted but faced a £2 million bill for legal fees and tax he had owed.

Ken had been with his partner, Ann Jones, for forty years but they had never married.  The rules surrounding inheritance mean that Ken could only leave £325,000 of his estate to her free of Inheritance Tax if they were unmarried at the date he died.  However, they married shortly before the comedian’s death so by tying the knot any money he left to Ann would be free of tax regardless of the amount.  So for example, if Ken had left his estate valued at £2 million to Ann and died before they married, £670,000 Inheritance Tax would have been payable. Following their marriage no tax would be payable.

Although Ken’s motive for getting married was no doubt the love and affection he felt for Ann the reduction in the amount of Inheritance Tax now payable on his estate may have brought a smile to his face.

If you need advice about any aspect of inheritance, estate administration, wills or probate, contact our friendly team today.

Author: Katy Burgin

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