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HMRC To Seize Profits From Aggressive Tax Planning Scheme

by Jason Gorringe, Tax-News.com, London

07 July 2017


HM Revenue and Customs (HMRC) has ordered those involved in marketing an illegal tax planning arrangement involving film finance to repay their ill-gotten gains or face ten years in jail.

The individuals were previously found guilty of participating in a tax fraud, involving tax rebates for investments in loss-making film partnerships.

The group claimed to have spent GBP5.7m (USD7.3m) on producing two films and made significant losses. HMRC investigators discovered a series of suspicious tax rebate claims, supported, it said, by faked invoices, accounting records, and bogus diary entries.

HMRC said that the illegal scheme would have allowed investors to recoup up to GBP40,000 in tax relief from HMRC for every GBP20,000 they had invested.

An accountant, two film producers, and an independent financial advisor, who were jailed with three others for more than 36 years for committing the GBP2.2m tax fraud, have been told to pay back GBP2m in profits or face a further ten years in prison.

The announcement from HMRC follows numerous actions it has taken against bogus film finance arrangements. In March 2017, the chairperson of the UK's Treasury Select Committee, Andrew Tyrie, wrote to the Chancellor Philip Hammond over concerns that the Government's effort to address tax avoidance in the UK film industry have resulted in "financial calamity" for some investors – specifically for those that had not realized that such tax planning arrangements do not work.

TAGS: tax | investment | United Kingdom | professionals | HM Revenue and Customs (HMRC) | HM Revenue and Customs (HMRC) | services | Invest

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