David Sullivan Ordered to Pay £700,000 After Using West Ham to Illegally Avoid Tax

West Ham United co-owner David Sullivan is deemed to have illegally dodged £700,000 in tax after it was ruled by a court that he used his 2010 purchase of the

West Ham United co-owner David Sullivan is deemed to have illegally dodged £700,000 in tax after it was ruled by a court that he used his 2010 purchase of the club to his deliberate benefit when transferring the sum of £2m from his family's private company.

A report from The Times explains that Sullivan has been ordered to pay the outstanding tax sum after a tax tribunal heard that the businessman used his family company, Conegate Ltd, to buy £2m worth of shares from the holding company that officially owns West Ham.

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Yet on the same day as that investment, those shares became 'deferred shares', making them worthless. That meant they were sold back to the holding company for £1. As a result, Conegate Ltd was able to use the £2m loss as a way to write £700,000 of its tax bill.

That is illegal because a loss is now allowed to be used to reduce a tax bill if the purpose of any such arrangement or transaction, or at least a main factor behind it, is to pay less tax.

The judge's ruling read, "It is clear from our findings of fact that there was more than one way to provide funding to the football club and that one of the reasons that Mr Sullivan chose to provide funds to the football club in the specific way that transpired was so that the appellant could claim a capital loss.

"Therefore we consider securing a tax advantage to have been 'one of the main purposes' of the arrangements."

Sullivan, co-owner David Gold and vice-chairman Karren Brady have all come under fire from increasingly enraged West Hams fans this season. They are seen to have broken promises to supporters over the ambitions and future of the club and are accused of selling a dream that is yet to materialise following the 2016 move to the London Stadium.

Tensions reached boiling point earlier this month when fans directed angry protests towards the directors box during the home defeat against Burnley. 

Sullivan and Gold had to be escorted out by security, but not before Sullivan had been struck by a coin that was thrown.