Tax advisers' offices raided by HMRC over gilt strip schemes

A firm of tax advisers has been raided by HM Revenue & Customs officials investigating a scheme involving the use of gilt strip bonds.

Mercury Tax Group, based in Leeds and London, was targeted by officials who also visited a number of the firm's clients.

In an unusual step Mercury flagged up the raid on its own website to highlight what it described as 'sledgehammer tactics' by HMRC in addition to claims that it had co-operated fully in the investigation.

'Having been left with the feeling that the HMRC have used sledgehammer tactics, we are taking advice on our response, including compensation if appropriate,' said a statement by the firm on its website. 'At present we continue to co-operate fully with HMRC.'

Partners at the firm were questioned by HMRC on 13 November after both the firm's offices were visited.

Gilt strip tax schemes involved the purchase and sale of gilts where an expense was claimed on the purchase and relief on its gains.

The schemes were stamped out by the government in 2004, and were classed as being the straw that broke the camel's back in terms of it leading to the introduction of the tax avoidance disclosure regime.

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