Angela Rayner’s lawyers claim they have been made “scapegoats” and did not give her tax advice, The Telegraph can disclose.
The conveyancing firm that handled the purchase of her £800,000 flat in Hove, East Sussex, insisted it had done nothing wrong.
The comments are a major blow to the Deputy Prime Minister, who has blamed “legal advice that I received” for her failure to pay a £40,000 stamp duty bill on the purchase of her seaside holiday home.
Verrico & Associates, a family company based in Herne Bay, Kent, confirmed that it had advised her on the purchase of the flat.
Joanna Verrico, the managing director, told The Telegraph: “We acted for Ms Rayner when she purchased the flat in Hove. We did not and never have given tax or trust advice. It’s something we always refer our clients to an accountant or tax expert for.
“The stamp duty for the Hove flat was calculated using HMRC’s own online calculator, based on the figures and the information provided by Ms Rayner. That’s what we used, and it told us we had to pay £30,000 based on the information provided to us. We believe that we did everything correctly and in good faith. Everything was exactly as it should be.
“We probably are being made scapegoats for all this, and I have got the arrows stuck in my back to show it. We are not an inexperienced firm, but we’re not qualified to give advice on trust and tax matters and we advise clients to seek expert advice on these.”
A spokesman for the Council for Licensed Conveyancers, which regulates such firms, said: “We have asked them for a full account of events.
“They are not licensed to provide tax advice. What they are licensed to do is to provide conveyancing advice, and they are regulated to the highest standards.”
Kemi Badenoch the Conservative Party leader, said: “This is yet more damning evidence that Angela Rayner has not been honest with the British public. From the start, we’ve had nothing but excuses, deflections and lies. Enough is enough.
“How many final straws can there be for Angela Rayner? She must resign or Keir Starmer must finally find the backbone to sack her.”
Ms Rayner admitted on Wednesday that she underpaid £40,000 of stamp duty on the seafront flat. She insisted she had relied on “legal advice that I received that said that I was liable to pay the standard stamp duty”.
It is understood the Deputy Prime Minister is arguing that she received at least three pieces of legal advice, including from the trust overseeing her son’s affairs and a conveyancer, supporting her initial position.
Two other law firms that have been involved in the trust or the sale of Ms Rayner’s properties have both publicly stated that they did not advise her on the stamp duty.
Shoosmiths, which set up a trust for her son in 2020, said: “We did not act for the Rt Hon Angela Rayner in relation to the purchase of her Hove property and/or the SDLT aspects of that property. Ms Rayner is not a current client of the firm and has not been for some time.”
A spokesman for mfg Solicitors LLP, which was involved in conveyancing on the Ashton-under-Lyne property, said: “We can confirm that we did not act for Ms Rayner in the purchase of her property in Hove, nor did we provide any tax-related advice in relation to it”.
Sir Laurie Magnus, the Prime Minister’s independent adviser on ministers’ interests, is investigating Ms Rayner’s claim and is expected to report back as soon as Friday.
On Thursday afternoon, Sir Keir Starmer indicated that he was prepared to sack the Deputy Prime Minister if she was found to have broken the ministerial code.
If she failed to provide that firm with all relevant information, or failed to seek all necessary advice, it would cast doubt on her explanation.
Verrico is a small conveyancing firm that does not employ any qualified solicitors. Instead, they are licensed conveyancers who only focus on property advice and typically handle straightforward transactions.
Experts said Ms Rayner’s choice of firm cast serious doubt over whether she had sought appropriate legal advice.
The Deputy Prime Minister referred herself to HMRC and the ministerial ethics watchdog days after The Telegraph first disclosed that she had avoided the extra stamp duty normally applied on a second home.
In her interview on Wednesday, she said she was “devastated” that she had made the payment based on “legal advice that I received that said that I was liable to pay the standard stamp duty”.
Kevin Hollinrake, the Tory party chairman, said it was baffling that Ms Rayner had failed to pay the extra £40,000 in stamp duty.
He said: “It is not complicated. It is quite simple and set out clearly on the HMRC website. It is very clear you should pay the extra stamp duty if your children own a property through a trust and you then buy a second property. The reality is it is not complex. You can go on to the HMRC website and find all this very easily.”
On Friday, Sir Keir vowed to “act on whatever the report is” into Ms Rayner’s tax affairs – but refused five times to guarantee he would dismiss her.
Last year, he updated the ministerial code to put a greater emphasis on the principles of public life and strengthened the terms of reference for the independent adviser.
Asked whether he would sack Ms Rayner if she was found to have breached the code, Sir Keir told the BBC: “Well, Angela Rayner has referred herself to the independent adviser. My experience is he will be comprehensive in the report that he gives me. He will be quick, and that’s what I’m expecting. And so I want to let that process take its course.”
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The company involved in the sale is a six-person firm, two of whom describe themselves as licensed conveyancers, two conveyancer executives and two legal secretaries. It is based in a small office attached to a Co-op convenience store in a back street in Herne Bay.
Searches by The Telegraph confirmed that none of those listed working at the firm are registered with the Law Society or the Solicitors Regulation Authority.
While licensed conveyancers are trained to deal with all aspects of property law, experts advise that solicitors should be used for more complex transactions because of their broader legal knowledge.
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2. Non-conveyancing and non-legal advice
A licensed conveyancer is a specialist property lawyer, qualified to advise on conveyancing law, probate and will writing only. If you need advice on other legal or non-legal matters [...] you should consult appropriately qualified professionals such as a litigation lawyer, a surveyor or a financial adviser.
Extract from Verrico & Associates’ terms of engagement
Verrico & Associates’ own terms of engagement say: “A licensed conveyancer is a specialist property lawyer, qualified to advise on conveyancing law, probate and will writing only. If you need advice on other legal or non-legal matters… you should consult appropriately qualified professionals such as a litigation lawyer, a surveyor or a financial adviser.”
The terms add that they may agree to submit the stamp duty return but “if your transaction is complex, we may also suggest you obtain independent tax advice”.
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8. Stamp duty Land Tax (SDLT) or LTT (Wales)
[...] If your transaction is complex, we may also suggest you obtain independent tax advice”.
Extract from Verrico & Associates’ terms of engagement
In January, Ms Rayner sold a 25 per cent share of the family home in Ashton-under-Lyne to a trust established for her son for £162,500. Months later, she purchased the £800,000 seafront flat in Hove through local estate agent Sam Ranger of Mishons.
The Telegraph revealed last week that she told HMRC it was her primary home for stamp duty purposes, meaning she paid about £30,000, rather than the £70,000 owed for a second home.
After a week of public declarations that everything had been done correctly, she has now admitted that the “complex nature” of the trust meant she should have paid the higher rate.
But in the wake of The Telegraph’s disclosures, she sought a second opinion from a leading tax adviser KC, who told her that this was wrong.
James Quarmby, a partner at Stephenson Harwood, said: “She should have really looked at seeking other advice, rather than a local high street conveyancer.
“I would presume that she thought it was a fairly simple transaction to be made, she thought that she had renounced herself of the Ashton property by selling her 25 per cent stake, and passed that information on to the conveyancers.
“Part of this has to come down to her judgment as well, and who she chooses to rely on for information. I don’t think you can necessarily ask that of a small high street firm which doesn’t do the ins and outs of stamp duty rules.”
Ms Rayner has not responded to a request for comment about her choice of legal advice.
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