Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Celebrities face £1bn tax bill in HMRC crackdown

2 Comments
Celebrities face £1bn tax bill in HMRC crackdown

A raft of celebrities that include David Beckham and Andrew Lloyd Webber face a potential tax bill of £1 billion in a dispute over an Ingenious film shceme, which HMRC alleges was used as a tax avoidance scheme.

The Revenue is attempting to demand the film scheme investors pay back tax relief received on their investment before a court battle gets underway to determine the legitimacy of the schemes, the Sunday Times has reported. 

The celebrities each paid a minimum £100,000 to invest in the Ingenious Film Partners 2 LLP, a film scheme that qualified for tax breaks under rules that were aimed at stimulating the British film industry under the previous government. The scheme helped to fund films such as Life of Pi, Avatar and Girl With a Pearl Earring. However, HMRC now argues that these schemes were not legitimate investment opportunities but rather used to avoid tax.

Ingenious, formerly led by Patrick McKenna, has retailiated by sending a letter to its clients warning them of HMRC's 'draconian' plans to force them to pay up before their case comes to court. The approach forms part of the Revenue's attempt to clear a backlog of 65,000 individuals and businesses suspected of using tax avoidance schemes.

The move also forms part of a long-running dispute with Ingenious Media Investments. Ingenious denies the schemes were designed to avoid tax and intends to fight the case at a tax tribunal, scheduled for November.

The Sunday Times reported that under current legislation the schemes’ investors would be able to keep the tax relief until litigation or an investigation was completed.

However, the paper said that HMRC now wants the forthcoming Finance Bill to force firms and individuals under suspicion of benefiting from a tax avoidance scheme to repay the disputed money.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Liontrust ESG head says sustainable investment doesn't mean low return

Liontrust ESG head says sustainable investment doesn't mean low return

Peter Michaelis talks about ethical investment growth and where he sees future opportunites.

Play Are platforms the biggest barrier to wealth manager ETF take-up?

Are platforms the biggest barrier to wealth manager ETF take-up?

Citywire hosted a roundtable discussion to find out how and if wealth managers are using ETFs in their clients' portfolios and the challenges they face trading through different platforms.

Play SVM's Veitch on what's next for banks

SVM's Veitch on what's next for banks

SVM fund manager Neil Veitch is finding value in what he describes as unstable financials and talks through his favourite small caps.

Read More
Your Business: Cover Star Club

Profile: UBS' robo boss on what his tween can teach the industry

Profile: UBS' robo boss on what his tween can teach the industry

Co-head of UBS SmartWealth Shane Williams explains the simple life lessons missed by the first wave of robo pioneers

Wealth Manager on Twitter