...soaring tax bills
The nation’s favourite Olympic underdog, Eddie ‘the Eagle’ Edwards, has admitted that his finances are in a precarious nature, as his divorce has caused him to part with 85% of his wealth while facing a large tax bill for money earned before his split was finalised.
Nicola Hartley, Independent Financial Adviser at Simpson Millar, explains how this is not the first time the ski jumper has fallen on hard times.
Cold shoulder during divorce settlement
Eddie has claimed that he is facing financial hardship as a result of his divorce from wife Samantha Morton, who is alleged to have taken all of the money Eddie received from the rights to a movie of his life.
The comedic biopic, charting Eddie’s rise to global fame as the plucky jumper who came last in the 1988 Winter Olympics, was released this year and starred Hugh Jackman.
Eddie netted £180,000 from the flick, however he claims this money has been lost in his divorce.
The issue now facing the inspirational Olympian, who was Britain’s first ever Olympic jumper, is the large tax bill owed on his Hollywood pay day.
In candid remarks, Eddie claimed that 90% of his bank balance is currently earmarked for tax purposes, after having to sell a flat he’d owned for 30 years in anticipation for a high tax bill.
The Bedford flat, which sold for £175,000, will incur a further bill, as capital gains tax on the sale could take up to 28% of any profit made on the property.
This is not the first time the sports personality has found himself in a precarious financial situation, as a poorly managed trust fund caused him to declare bankruptcy in 1992.
After investigating his rights to complain and the legal action he could take, Eddie took an interest in the law and earned a degree in the discipline in 2003.
Describing his rise from earning £6,000 a year to £10,000 an hour, Eddie explained how poor management from the people running his trust fund meant that they had not left enough money aside for his tax bills at the time, forcing him into involuntary bankruptcy.
Despite claiming some of his money back via an out-of-court settlement after suing the trustees for mismanagement and negligence, Eddie had to essentially start again and it was a mix of continued PR work and plying his original trade as a plasterer that saw him get back on his feet.
Commenting on the endearing ex-Olympian’s finances Nicola says:
“Having to file involuntary bankruptcy for an inability to pay tax in the past clearly plays heavily on the mind of Eddie here, as he is selling assets and earmarking funds for his upcoming tax bill, which is bound to be high due to his earnings from his biopic.”
“Inland revenue allowed him to sue his trustees for the poor management of his finances back in 1992, which highlights the level of gross negligence that caused Eddie to lose the wealth he accrued when he first rose to fame.”
“While there was a financial regulatory authority in place back in 1992, today such situations would be dealt with by the Financial Conduct Authority (FCA), who protects consumers from the harm that can be caused by bad conduct in the financial services industry.”
“Due to the seriousness of the consequences that come from unpaid tax bills, I would advise everyone to take heed of the lesson that Eddie the Eagle has learned from his previous problems and ensure that they always put enough funds aside to cover any outstanding tax payments.”
Written by Nicola Hartley.
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