Zac Goldsmith, the prospective Conservative MP and prominent environmentalist, has defended himself from criticism after it emerged that he claimed non-domicile tax status.
Goldsmith, who is estimated to be worth £200m, insisted that he derived "very few benefits" from his non-domicile status, which allows him to avoid paying tax on earnings outside of Britain.
The Liberal Democrats have called on David Cameron to strip Goldsmith of his position as a parliamentary candidate.
The party's Treasury spokesman, Lord Oakeshott, said: "He's not fit to sit in Parliament when he's claimed non-dom status all his life to keep his offshore hundreds of millions free of income, capital gains or inheritance tax."
But Goldsmith, who inherited a fortune from his industrialist father, Sir James Goldsmith, denied suggestions he had "dodged" tax and said he had already decided to relinquish his non-domicile status.
He said: "Despite having been non-domiciled because of my father's status, I have always chosen to be tax resident in the UK. Virtually everything I do is in the UK and therefore virtually all my income comes to the UK where I pay full tax on it.
"I do not derive any benefits as far as either capital gains tax or inheritance is concerned since I am registered for the latter in the UK. Because of my own choices, the non-domicile status has delivered very few benefits. I have, in any event, already decided to relinquish it."
Goldsmith, who is standing in Richmond Park and North Kingston in west London, will be seeking to win the seat from the Liberal Democrats at the next election.