Angela Rayner could struggle to pay the mortgage on her new £800,000 home in Hove after having her salary slashed following her departure from Sir Keir Starmer’s Cabinet, it has been reported.
The axed Deputy Prime Minister will see her salary reduce from £161,409 to £93,904 as she loses the additional income she received while serving as Housing and Communities Secretary.
Ms Rayner also faces having to pay back the £40,000 stamp duty she owes, plus interest, and her political rivals are calling on her to forfeit her £16,876 severance payment.
Until yesterday, Ms Rayner had access to a lavish grace and favour Whitehall flat in Admiralty House, as well as her £650,000 Ashton-under-Lyne constituency home a three-bedroom pad in Hove.
Ms Rayner had bought the seaside property for £800,000 but failed to pay the correct amount of stamp duty, underpaying HMRC by roughly £40,000.
As a result of her ‘carelessness’ she resigned when a report by the Government’s sleaze watchdog found she had broken the Ministerial Code.
She also resigned as Housing and Communities Secretary and quit her elected role as Labour’s deputy leader, prompting Sir Keir Starmer to shake up his cabinet.
In a handwritten letter, Sir Keir hailed her as the ‘living embodiment of social mobility’ and told her he was ‘very sad to be losing you’.
Angela Rayner (pictured) found herself in hot water after failing to pay the correct amount of stamp duty, underpaying HMRC by roughly £40,000
The former Deputy Prime Minister expanded her property portfolio to include a three-bedroom holiday home in Hove worth £800,000 (File image)
He added: ‘You have been a trusted colleague and a true friend for many years. I have nothing but admiration for you and huge respect for your achievements in government.’
But the PM’s kind words will not be enough to protect his former right-hand woman from yet another blow.
The Ashton-under-Lyne MP will no longer be in receipt of her £161,409 annual salary and will instead be demoted to her basic MP’s pay.
Ms Rayner will now be taking home £93,904 and her £67,505 pay as Housing Secretary will instead be paid to her replacement Steve Reed, MP for Streatham and Croydon North.
The Conservatives are also calling for her £16,876 severance payment to be stripped.
It could result in the loss of her new home, according to The Telegraph.
Ms Rayner previously revealed she had used her life savings to cobble together a downpayment on her Hove flat.
She also sold her 25 per cent stake in the family home in Ashton-under-Lyne for £162,500 and funneled that in to the £150,000 deposit.
Official documents have revealed she has a £650,000 mortgage on the seaside flat through NatWest.
The living room of elegant Victorian terrace offers sweeping views of the Hove seafront – a view the politician spent her entire life savings on
Ms Rayner’s new flat in Hove boasts a spacious fitted kitchen – but the former right-hand woman of Sir Keir Starmer could struggle to cover the mortgage following her fall from grace
Her monthly mortgage payments may be as high as £4,000, while her monthly income after tax will only come to £5,400, according to the publication.
In contrast her take home pay each month when she was Deputy PM was almost double that at £8,100.
Ms Rayner will now also have to factor in expensive travel costs as she will have to commute to London to appear in the Commons from either Hove or Manchester now she now longer has access to her flat in Admiralty House.
She may also have to pay a £40,000 tax bill and a penalty of £12,000 plus interest on top of about £1,000, coming to an eye-watering total of £53,000.
The Daily Mail has contacted Ms Rayner for comment.
The former Housing Secretary’s awkward finances come after she found herself in hot water over her housing affairs.
Ms Rayner had her £650,000 Ashton-under-Lyne constituency home (pictured)
The MP also lived in a three-bedroom grace-and-favour flat in Admiralty House (pictured) – which used to be home to Winston Churchill
When she entered the Government, Ms Rayner designated her constituency home as her ‘primary residence’, and her pre-Admiralty home – a rented London flat – as her second home.
That allowed her to claim back the £1,621 council tax bill on the London flat from the taxpayer as one of the housing costs reimbursed by Commons authorities.
It later emerged she had sold her share of that property to help fund the purchase of the flat in Hove, which allowed her to be closer to her on-off boyfriend Sam Tarry.
In an unusual move, she sold her stake to a trust set up to provide for her disabled son who still lives in the property.
But tax experts suggested that she would still be considered to have an interest in the property as her son is under 18 – meaning that the Hove property should have attracted the punitive rate of stamp duty levied on second homes.
Yesterday Sir Laurie Magnus, the PM’s independent adviser on ministerial standards, accused Ms Rayner of an ‘unfortunate failure to settle her stamp duty liability’.
Sir Laurie said that although Ms Rayner took legal advice from two separate sources, neither was a tax expert. One warned her that she should seek specialist tax advice but she failed to do so.
As a result she paid around £30,000 in stamp duty on the flat in Hove, rather than the estimated £70,000 that was due if the property was treated as a second home.
Sir Laurie said he accepted Ms Rayner had acted in ‘good faith’. But he said her failure to seek the right advice, coupled with the fact that the truth only came out as a result of ‘intensive public scrutiny’ by the media, meant she had failed to conduct her affairs to the ‘highest possible standards’ required of ministers.
He said he had also considered evidence on other issues, including council tax and inheritance tax but had decided to ‘focus my inquiries’ on the stamp duty issue.
