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Stars could face huge bills as tax case looms

by Daniel Grote on Dec 10, 2012 at 08:10

Stars could face huge bills as tax case looms

Celebrities could face tax bills running into millions of pounds if a looming tax tribunal case goes against film scheme provider Ingenious Media, according to the Mail on Sunday.

Investors in the billion schemes include footballers David Beckham, Steven Gerrard and Wayne Rooney; TV presenters Jeremy Paxman and Anne Robinson; and pop star Robbie Williams.

According to the Mail, HMRC will argue its case against Ingenious at a tax tribunal, with hearings likely to begin next year. Ingenious has called for the tribunal to bring to a head the Revenue's long-running investigations, it added.

Ingenious Media Investments chief executive James Clayton said: 'We welcome the opportunity this gives us to finally bring the matter before the tribunal where we will have our case heard by an independent assessor.' 

11 comments so far. Why not have your say?

Dynamike

Dec 10, 2012 at 08:42

Hope HMRC win - there's not one name on that list that deserves the money anyway.

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Pat Riot

Dec 10, 2012 at 09:20

Is this one of those schemes where you only get the tax relief if you spend a certain number of hours "working" on film production? e.g thinking up plots etc? If so; wayne rooney?

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Financialplanner2012

Dec 10, 2012 at 09:31

@Dynamike

I find it saddening that as, presumably, a qualified financial planner, you consider that such matters should be decided on the merits of the involved celebrities.

However, I do hope that this case will be judged on the facts, rather than spurious sentiment.

I am not a supporter of 'aggressive' tax schemes that are designed to save tax, regardless of their commercial outcomes. While a number of the Ingenious schemes did involve the writing-down of certain assets in order to generate short-term losses, their films are bona-fide productions (eg, Avatar) with investors' returns dependent on box-office sales.

Were it not for production companies such as Ingenious, the British film industry would have died long ago.

Perhaps you could explain what the difference is between a Govt using tax legislation to fund investment in higher risk industries, and companies using legitimate tax concessions to do the same?

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Bob Donaldson

Dec 10, 2012 at 09:37

Perhaps it is the times we live in which makes these schemes seem a little 'risky'. Remember the BES schemes of old which were supposed to promote 'Business Expansion' but the universities used them for building student accommodation, homeless accommodation etc, everything but promote the desired object of the tax break.

They did not come under attack from the revenue they were simply abolished at a future budget.

Maybe now that the revenue staff are given a bonus for hunting down tax, things have become more aggressive.

My worry is that advisors once again will come under the spotlight for promoting such schemes to clients. They will be to blame not the revenue or the companies that offered such schemes in the first place.

Perhaps a few more advisors will receive complaints and will that then fall on the FSCS pulling us all down?

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Keith Cobby

Dec 10, 2012 at 09:53

Mr Laffer had the answer to tax avoidance.

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Keith Cobby

Dec 10, 2012 at 09:54

Mr Laffer had the answer to tax avoidance.

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levelplayingfield?

Dec 10, 2012 at 10:08

The tribunal hearing called for by Ingenious is good news.

HMRC has taken an inordinately long time to deal with these cases before giving it's view, which is more to do with its current position than that which prevailed 5 or 6 years ago when investors put their money in. That is not justice for both those who invested and the commercial organisation raising risk capital for the media industry, generating jobs in this country.

Behind the two investment opportunities mentioned in the article I am aware that there are other investment opportunities that were offered subsequently by Ingenious, upon wihch tax reliefs were available to be claimed by anyone, based on tax law as it then stood.

This appears to be yet another example of deliberate delay as a tactic by HMRC to discourage use of tax reliefs by taxpayers or commercial organisations trying to raise risk capital for business.

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Harriet Marlow

Dec 10, 2012 at 10:44

@Pat Riot

Script adviser on the much anticipated sequel "Die Hard 6: Dying on arse in crucial Premier League clash 2011", a film written and directed by Roberto Mancini. Possibly.

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David Cathcart

Dec 10, 2012 at 10:45

I seem recall Tony Blair waiving a GOVERNMENT CERTIFIED film certificate in the air, at his star studded reception at Downing Street, to promote investment into the British film industry.

If I were Ingenious, I would would be calling Mr Blair and all the other Labour MP like John Prescot, to give evidence on Ingenious's behalf at the tribunal.

The one thing that Ingenious were always insistantant upon, was never to promote a film scheme that had not already secured this certificate from of all people HMRC !!

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Man of Kent

Dec 10, 2012 at 10:47

@Keith Cobby

Keith - Mr. Laffer and his Performing Curves may have had the answer to tax avoidance, but did he have any suggestions for how the British film industry could raise (risky) production money without there being some incentive?

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Ian Watson

Dec 11, 2012 at 08:37

The law of "unintended consequences " reigns and it is always hard for lawmakers to predict how rules will be interpreted by the commercial world.

However, I would ask a different question.

Not being a film buff, why does the British film industry needs subsidising to this degree anyway ?

Are we bad filmmakers, has the day of the cinema been superceded by the Internet, or do they overprice themselves, ( as do footballers ? ) especially in these times of austerity ?

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