Oscar-winning actor Nicolas Cage has been forced to pay £650,000 (£378,000) in back taxes and penalties to the Internal Revenue Service after he was accused of wrongly writing off almost $3.4m (£1.9m) in personal expenses.

The actor and his production company, Saturn Productions have agreed to pay the amount according to papers filed with the U.S. Tax Court.

Necessities claimed as business expenses included limousine rides, meals and the maintenance of a private jet.

Tax drama: Nicolas Cage, pictured with his wife Alice Kim, has been ordered to repay £378,000 in back taxes and penalties

‘Household help’ at Cage's numerous homes cost more than £100,000 - he has properties in Los Angeles, the Bahamas, Rhode Island and Midford Castle, near Bath.

In February, Cage's business manager, Samuel J Levin, said deducting the cost of food, domestic staff and travel from declared earnings was 'customary in the entertainment industry' and necessary to finance Cage's 'security needs.'

In 2004, Cage  - whose latest movie Bangkok Dangerous was savaged by critics - reported his taxable income as $17 million, but the IRS claimed that it was closer to $18.5 million. US magazine Forbes estimated his income this year at $38 million.

Cage recently put his Tudor mansion in Bel Air up for sale for £16.4 million and is said to be moving into a smaller home.

The house Cage was once owned by Dean Martin and has nine bedrooms and bathrooms, with an Olympic-size pool and 35-seat home cinema.

Meanwhile fellow actor Wesley Snipes was acquitted of felony charges of fraud and conspiracy earlier this year but was convicted for failing to file tax returns or to pay taxes from 2002 to 2004 and jailed for three years.

Cage is married to Alice Kim, 26, the couple have a two-year-old son, Kal-El. The actor is also father to 17-year-old Weston from a previous relationship.