Cabinet ministers have lined up to defend Angela Rayner as it emerged the Deputy Prime Minister consulted three people before purchasing a flat on which she underpaid stamp duty.
Chancellor Rachel Reeves gave Ms Rayner her “full confidence” to remain in post while Education Secretary Bridget Phillipson said she had “sought to be transparent” in scandal over her tax affairs.
It comes as sources close to the Deputy Prime Minister said she was given three separate pieces of legal advice before buying an £800,000 property in Hove.
Sources said a conveyancer and two experts in trust law had all suggested that the amount of stamp duty she paid on the property was correct and she acted on the advice she was given at the time.
Ms Rayner has been under mounting pressure in recent weeks after reports emerged she had saved £40,000 in stamp duty on her East Sussex flat by not paying the higher rate reserved for additional home purchases.
On Wednesday she admitted she had made a “mistake” and referred herself to standards adviser Sir Laurie Magnus after receiving fresh legal advice that she was liable for the extra duty following headlines about the purchase.
Speaking to broadcasters on Thursday, Ms Reeves said: “I have full confidence in Angela Rayner. She’s a good friend and a colleague she has accepted the right stamp duty wasn’t paid.
“That was an error, that was a mistake. She is working hard now to rectify that, in contact with HMRC to make sure that the correct tax is paid.”
She said the “definitive advice” on the Deputy Prime Minister’s stamp duty arrangements came in on Wednesday morning.
Ms Phillipson said initial follow-up advice “came back on Monday” and that Ms Rayner then applied to have the court order lifted which prevented her speaking about the arrangements.
“She has acted in good faith, sought to act appropriately with the information available to her,” she told Times Radio.
Ms Phillipson said the case was different from scandals under the previous Conservative government, of which Ms Rayner was a vocal critic, adding: “What we saw in some of those cases in the past was a lack of scrutiny and a lack of transparency.
“The Deputy Prime Minister has sought to be transparent, has set out in some detail, which has been difficult given that it relates to her family, extensive information.”
But she declined to say Ms Rayner would remain as Deputy Prime Minister, telling LBC: “I’m not going to get into hypotheticals or speculate. I’m sorry to disappoint you. I’m just not going to do it. That process will run its course.”
Details about the complex arrangements have continued to emerge since Ms Rayner’s statement on Wednesday, with the Telegraph newspaper reporting that some money from a trust set up to care for her disabled son following a settlement with a NHS hospital was used to buy the flat.
In her public remarks on the matter, she had said that a court-instructed trust was established in 2020 following a “deeply personal and distressing incident” involving her son as a premature baby.
The trust was established to manage the award on his behalf as he was left with life-long disabilities, she said.
To ensure he continued to have stability in the family home, she said her family had agreed that its interest in that property – in Greater Manchester – would be transferred to the trust of which he is the sole beneficiary.
She said she had put her stake in the constituency home in Ashton-under-Lyne into this trust, which a “leading tax counsel” had later told her made her liable to pay the additional stamp duty on her new Hove flat.
Tax experts said the new property could not be treated as her only residence because of the nature of the trust.
The Conservatives have written to HMRC calling for it to launch its own investigation on whether she tried to evade tax, with party chairman Kevin Hollinrake saying her explanation “cannot withstand scrutiny”.
Sir Keir Starmer stood by his deputy at Prime Minister’s Questions, saying he was “very proud to sit alongside her” amid calls from Opposition critics for her to resign over the row.
Ms Rayner has said she is “working with expert lawyers and with HMRC to resolve the matter and pay what is due”.
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