Angela Rayner faces crunch moment as ethics probe set to report on tax row

Angela Rayner is expected to face a crunch moment on Friday as she battles for her political future.

An independent ethics probe into the Deputy Prime Minister’s tax affairs is expected to report back ahead of the weekend on whether she broke ministerial standards rules.

One minister conceded on Friday morning there was “frustration” about the investigation process, and said it would be a “good thing” for the Government if the probe concluded quickly.

It comes as lawyers she blamed for her stamp duty underpayment denied having given her tax advice.

Sir Keir Starmer repeatedly declined to say whether he would sack his deputy, who is also the Housing Secretary, if his independent ethics watchdog rules against her.

The Prime Minister said he would “of course” act on the findings of Sir Laurie Magnus’s probe following Ms Rayner’s acknowledgement that she failed to pay a £40,000 tax surcharge on a flat she bought in Hove this year.

Ms Rayner’s colleagues in Government have lined up to defend her record, with trade minister Douglas Alexander on Friday morning telling Times Radio she was in politics “for the right reasons”.

Mr Alexander also urged patience ahead of the conclusion of the investigation, telling BBC Breakfast: “I would just ask your viewers to think, what would they want, in their circumstances, in their workplace. Of course, there need to be procedures.

“There’s frustration while that process is under way but I think everyone is entitled to due process, and that’s the process that’s under way, but, listen, I get it.”

He added: “I’m not pretending these are headlines that any of us would choose, least of all Angela Rayner, and that’s why, if the reports are true that this is going to be dealt with relatively quickly, of course, I think that’s basically a good thing, not just for Angela, but for the Government as well.”

Mr Alexander told LBC that “on a personal level” he hopes Ms Rayner remains as Deputy Prime Minister.

The advice she received is likely to form a key plank of Sir Laurie’s investigation, after Ms Rayner said she was incorrectly advised that she did not need to pay the higher stamp duty rate reserved for second home purchases.

Sources close to Ms Rayner said a conveyancer and two experts in trust law had all suggested the amount of stamp duty she paid on the East Sussex property was correct and she acted on the advice she was given at the time.

But the conveyancing firm, Verrico and Associates, on Thursday said its lawyers “never” gave Ms Rayner tax advice and were being made “scapegoats”.

In a statement, managing director Joanna Verrico said: “We’re not qualified to give advice on trust and tax matters and we advise clients to seek expert advice on these.”

The founder of the small high street firm, based in Herne Bay, Kent, said it completed her stamp duty return “based on the figures and the information provided by Ms Rayner”.

Ms Rayner referred herself for an ethics investigation on Wednesday, admitting that she had not paid enough stamp duty on the purchase of the £800,000 flat.

She said she had initially been advised that she was not liable for the second property surcharge because she had sold her stake in her family home in Ashton-under-Lyne to a court-instructed trust established in 2020 to benefit her disabled son.

But she conceded she had made a “mistake” after fresh legal advice from a “leading tax counsel” later revealed that she was liable for the extra duty on her new Hove flat.

Before then, she had insisted for weeks that she had paid the correct amount of tax.

The independent ethics adviser will assess whether Ms Rayner broke the ministerial rules, which place an “overarching duty on ministers to comply with the law”, “behave in a way that upholds the highest standards of propriety”, and “be as open as possible” with the public.

Sir Keir told the BBC he would “act on whatever the report is that’s put in front of me”.

The Labour leader said it was for the independent adviser to establish the facts around the controversy, “then of course it does fall to me – I completely accept that – to make the decision based on what I see in that report”.

Tory leader Kemi Badenoch repeated her calls for the Prime Minister to sack Ms Rayner, saying the conveyancer’s denial that it advised her on tax “is yet more damning evidence that Angela Rayner has not been honest with the British public”.

Losing the Deputy Prime Minister would cause a headache for Sir Keir as he seeks to reset Government following a difficult summer dominated by criticism of the small boats crisis and speculation about tax rises in the autumn Budget.

Ms Rayner is popular among the Labour grassroots and is said to have played an important role in defusing the backbench revolt over proposed welfare cuts earlier this year.

She is key to his political project, overseeing the manifesto pledge to build 1.5 million new homes as well as the Government’s flagship workers’ rights expansion, and is seen as a bridge between No 10 and the wider party.