Company agrees to pay €53,000 in back taxes following investigation, as U2 frontman ends his minority investment

This article is more than 2 years old

This article is more than 2 years old

A Lithuanian company linked to the U2 frontman Bono has agreed to pay €53,000 (£47,000) in back taxes and a fine following an investigation prompted by the Paradise Papers.

The Irish singer, whose real name is Paul Hewson, was a passive minority investor in a Malta-based company which bought a shopping centre in north-eastern Lithuanian via a holding company in the country called Nude Estates 2.



After Bono’s link to the Lithuanian firm emerged, a local tax expert who looked at its accounts claimed it may have fallen foul of local rules when it revalued the Aušra shopping centre following the economic downturn in 2010.



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The revaluation created a €3m loss which the company then offset against its income, enabling it to avoid the 15% tax payable on profits.

However, following the Paradise Papers investigation, the tax office stepped in over concerns that this use of losses broke Lithuanian laws.

On Friday it said the company had paid €34,000 in profit tax for 2012 and €19,000 in penalty fees for the delay.

Ruta Asadauskaite, a spokeswoman for the Lithuanian State Tax Inspectorate, told the news agency AFP that the investigation was finished “at the end of last year”, after which the tax authorities recommended that the company pay up.

At the time, Bono said he would be “extremely distressed if even as a passive minority investor ... anything less than exemplary was done with my name anywhere near it”.

Following news of the settlement, he said: “I fully support the tax authority’s inspection, and am thankful it’s now complete. It is my understanding that Nude Estates has now voluntarily made a payment to cover a technical error in a 2012 filing.

“Though no wrong-doing by the company has been suggested by the revenue, I am not happy that it took the inspection to reveal this error so I have instructed my advisers to end my investment in the company that I had no hand in running.”