Celebrity film scheme to appeal £700m tax case decision

Added 2nd June 2017

British investment advisory group Ingenious Media said it will appeal an August 2016 Tax Tribunal ruling on the status of its film production partnerships which date back as far as 2002 and involve many famous actors and footballers.

Celebrity film scheme to appeal £700m tax case decision

Ingenious Film Partners lost a case against HM Revenue and Customs in August 2016 that claimed its film scheme artificially created losses through investments in films so investors could claim tax relief.

In May, the film scheme operator sought to “clarify a technical point” on that ruling over whether film production costs claimed were capital costs and therefore not tax deductible, which could have overturned the 2016 decision.

However, the judge ruled, “with misgivings and reluctance”, that the film production costs were capital costs and therefore not tax deductible.

Ingenious chief executive Neil Forster said: “We strongly disagree with the Tribunal's clarification and find it wholly unsatisfactory that the Tribunal reached this decision with ‘misgivings and reluctance’. 

"We will be appealing the entire decision of the Tribunal,” he said.

Former cricketer David Gower, who invested via Ingenious, has also hit out at HMRC: "People were accusing the innocent investors of trying to evade [their] responsibilities. That is completely untrue.

"Innocent investors went in on advice and if anyone has been immoral and unfair it's HMRC," reports UK newspaper the Daily Mail.

Forster also refuted media reports that the May 17 Tribunal was an appeal, stating that it “has been presented in the media in a wholly-biased manner which misrepresents the facts and misleads the reader”.

He explained that the Tribunal was not a bid to overturn to August 2016 decision.

"Ingenious believes this further decision compounds the errors made by the First Tier Tax Tribunal and reinforces the need to take this matter to a higher court," the company said in a statement.

The appeal to the Upper Tribunal is likely to be heard during 2018 and Ingenious said it is confident of victory.

 

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Kirsten Hastings

Senior Reporter

Kirsten is a senior reporter for International Adviser, covering global news stories about the financial services industry. She joined Last Word Media in October 2015 after two years working as a reporter covering the staffing and recruitment industry. Kirsten has a Masters in Financial Journalism from the University of Stirling. 

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