A GROUP of investors in film schemes HMRC has determined as tax avoidance are suing Ingenious Media, the company that offered the schemes, and leading banks after losing more than £100m.
The law suit against Ingenious Media, which financed several blockbusters including Avatar, Life of Pi and The Girl With the Pearl Earring, follows a tax tribunal ruling last month which branded elements of the scheme as tax avoidance.
The ruling represented a partial victory for the taxman, with both sides attempting to claim the ruling as a victory. Ingenious is considering whether to appeal the ruling.
Investors in the scheme, including celebrities and sports stars have been left facing tax bills of around £1bn in total.
David Pickstone, head of tax litigation at Stewarts Law the firm bringing the action, said, “Investors were assured that these partnerships were entirely legitimate trading businesses seeking to make profit through financing films and video games.
“They were also assured as relevant that these investments satisfied the rules behind government endorsed tax incentives introduced to boost investment in the British film industry, effectively mitigating the risk to investors’ capital. Our clients, having invested in good faith, now face large losses as a consequence of the decision.”
Ingenious have not commented on the issue.
Rosamond McDowell looks at key changes to inheritance tax policy, which apply from April this year
The average cost of fraud increased 35.4% to £3.9m in 2016, compared to 2015 data
Report argues that the government must change the way it makes tax and budget decisions
Partner at Pinsent Masons says Serious Fraud Office has secured 'one of the top ten enforcement actions of all time'