Camila Batmanghelidjh facing calls to resign

The govt have refused a £3,000,000 grant to Kids Company until she steps down as the boss.

She gave her explanation of the refusal of the grant.

But another reason has emerged.

http://www.dailymail.co.uk/news/article-3157634/Mystery-charity-s-unpaid-700-000-tax-bill-Kids-Company-took-money-staff-waived-taxman-Chancellor-Gordon-Brown.html

Camila Batmanghelidjh facing calls to resign as chief executive of charity
£689,000 was taken from staff in employment taxes in single financial year
But taxman agreed a secret deal to waive £589,000 of the tax arrears
The remaining £100,000 of the sum was then paid by an unknown donor   

Britain's most high-profile children's charity chief was facing fresh pressure last night over an unpaid £700,000 tax bill which was mysteriously waived by the then Chancellor Gordon Brown.

Camila Batmanghelidjh is already facing calls to step down as chief executive of Kids Company after Ministers expressed concern over her management of the charity.

Now The Mail on Sunday has established a total of £689,000 was taken from staff in employment taxes during a single financial year, but not passed on to HM Revenue & Customs.

In a highly unusual move, the taxman agreed a secret deal to waive £589,000 of the tax arrears, with the remaining £100,000 paid by an unknown donor.

The episode might help to explain why it was announced this month that Ministers intended to withhold a £3 million Cabinet Office grant from Kids Company until Ms Batmanghelidjh stepped down.

She claims she is being forced to leaving because she told Ministers that she has a list of Establishment figures involved in historical child sex abuse.

Government sources say they are keen for the charity to continue its work – it is said to have provided practical and emotional support to thousands of vulnerable children over the past 20 years – but want to see more disciplined financial management under a new chief executive.

After agreeing last month to quit as chief executive, the £90,000-a-year charity chief has used TV and radio interviews to defend herself and is now refusing to name a departure date.

The tax bill came to light after this newspaper learned that Companies House has no annual accounts for the charity for the calendar year 2002. However, buried in the 2003 accounts is a paragraph headed 'Exceptional Item'.

It confirms that the charity held talks in 2002 and 2003 with the Inland Revenue over 'arrears of employment taxes'. In July 2003 it was agreed that £589,957 would be 'waived' by the Inland Revenue. The charity paid the outstanding £100,000 of the total £689,957 bill.

At the time, Mr Brown was Chancellor Ms Batmanghelidjh had struck up a good relationship with the Labour Government: the charity's 2001 accounts boast of Ministers releasing £300,000 to Kids Company 'within a period of seven days' after a lobbying exercise.

Problems surrounding Kids Company were first identified in March, when three senior directors including its interim finance chief announced they were quitting.

Concerns have also been raised by former staff about cash handouts made to some of the children it supports.

At the time, Mr Brown was Chancellor Ms Batmanghelidjh had struck up a good relationship with the Labour Government

A Kids Company spokesman said: 'In 2002, there were a high number of vulnerable children with complex needs attending Kids Company who were not receiving statutory support.

'We had to focus all our resources on meeting these children's immediate needs. Kids Company worked with the HMRC to agree a partial payment of NIC [National Insurance Contributions].

'The HMRC recognised that their actions made a significant contribution towards helping support some of society's most at-risk children.'

Last night, a Kids Company source said: 'There was a financial hiccup and the Treasury did a deal with us to help us out. Camila is staying with the charity'.

An HMRC spokesman said: 'HMRC does not comment on identifiable taxpayers'.