Michael Henshaw

The Guardian-13 years before

He is perhaps best known for having set up the unusual tax arrangements between the BBC and John (now Lord) Birt, its director-general from 1992 to 2000. Rather than pay Birt a salary, the corporation hired John Birt Productions Ltd, which gave him a tax advantage. The arrangements caused controversy when they were discovered in 1993, and there was further outrage when it emerged that Birt's company paid his wife two salaries, as a secretary and as a director, further reducing his tax bill. Though perfectly legal, the ploy infuriated the tabloids.

Michael's other media clients inc...uded television and film producers Ken Loach, Ken Trodd and Tony Garnett, theatre director Michael Bogdanov, broadcaster Humphrey Burton and actor Anthony Hopkins. Among his writers were David Mercer, David Hare, Fay Weldon, Alexander Trocchi, Simon Gray, Monty Python collectively, then Terry Jones and Michael Palin, as well as poets Ted Hughes, Basil Bunting, and even Allen Ginsberg when he was in Britain.

He looked after the finances of poetry publishers Fulcrum Press, sorted out William Burroughs' tax problems and also assisted Procol Harum. In the arts, he represented painters Tom Phillips, Ralph Steadman, Joe Tilson, Pauline Boty, Derek Boshier and Derek Jarman. At one point, he did the accounts for the controversial psychiatrist RD Laing, and in 1977 he subsidised the launch of Vole magazine by letting its founder and editor Richard Boston (obituary, December 23 2006) live rent-free in his basement.

Michael was the "cool" accountant, zipping around town in an open-topped sports car, living in a large house overlooking Regent's Park, filled with books and art, his first-floor study dominated by a huge (and extremely fashionable) Arco lamp made of marble and chrome, the epitome of swinging London. In 1967, an Observer article on the counter-culture described him as "the eminence grise of the underground".

Born in Derby, Michael attended the local Bemrose grammar school and after national service with the Royal Rifle Corps, took the civil service exams. He joined the Inland Revenue as a tax inspector at Shepherd's Bush, west London. His teenage friend, John Dexter, had also moved to London, where he became a theatre director, and Michael began to informally handle Dexter's tax for him. Together, they frequented the Partisan coffee bar on Carlisle Street, Soho, where Dexter introduced Michael to playwright Arnold Wesker.

In 1960, the TUC passed resolution 42, a call to promote working-class theatre, and Wesker was given a £10,000 grant to set up Centre 42 to translate it into action. He asked Henshaw to become the organisation's administrator - and Michael, delighted to leave the Inland Revenue, leapt at the chance. Raymond Williams, Frank Cousins and Doris Lessing were all involved in Centre 42, but the day-to-day work was done by Wesker and Henshaw. Centre 42 acquired the Roundhouse in Chalk Farm Road, Camden, intending to convert it into an arts centre, and though that dream was never accomplished the organisation ran a series of successful arts festivals around the country.

In 1965, Michael set up a magazine company for myself and the under-ground activist John "Hoppy" Hopkins. Within a year, this enterprise had evolved from poetry and spoken word records into International Times (IT), Europe's first underground newspaper, of which Michael was company secretary. Within a few issues we were raided, and Michael was obliged to root around the basement of West End Central police station, where all our files had been dumped, trying to find chequebooks and bank statements. A huge fundraising benefit called the 14-Hour Technicolour Dream was organised at Alexandra Palace. The event is now seen as the pinnacle of 60s London counter cultural activity.

Michael was also the accountant for the Indica bookshop, in whose basement IT first started, and Indica gallery, where John Lennon first met Yoko Ono. When Jim Haynes started the Arts Lab in Covent Garden, Michael was, naturally, its accountant. "Who else would I have used?" said Haynes.

But things did not always go smoothly, and Michael's unorthodox approach sometimes caused mayhem. Many clients left, horrified at unexpected tax bills; others had problems getting their papers back - there seemed to be a black hole into which his files vanished. His method of dealing with the Revenue was a mixture of stonewalling, combined with the kind of personal confrontation that no tax inspector wants. He won a number of important concessions, but it was nerve-wracking for all involved. In spite of it all, at the time of his death he still had 100 or so loyal clients.

He is survived by his wife Penelope, whom he married in 2003 after a long association, and Rachel, Bryony and Ben, the children from his marriage to Anne, which ended in 1980.

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