Crack­down on tax loop­holes rakes in an ex­tra £1bil­lion

Daily Express - - NEWS - By Cyril Dixon

TAX in­ves­ti­ga­tors have clawed back an ex­tra £1bil­lion over the last year in an un­prece­dented crack­down on pay­ment loop­holes.

Fig­ures pub­lished to­day show HMRC in­creased the amount of rev­enue it col­lected through “avoid­ance scheme” in­quiries by nearly 50 per cent.

In­ves­ti­ga­tors scru­ti­nised film part­ner­ships used by mil­lion­aire celebri­ties like David Beck­ham and Ant and Dec.

But they have also tar­geted or­di­nary peo­ple who had the so-called Loan Charge scheme thrust upon them by em­ploy­ers.

As part of the mea­sure, com­pa­nies can make their work­ers take a tax-free, non-re­turn­able loan in­stead of pay­ing them a bona fide wage.

The scheme means both em­ployer and em­ploy­ees es­cape pay­ing Na­tional In­sur­ance, but HMRC has started chas­ing up the work­ers for their un­paid tax. re­port by ac­coun­tants UHY Hacker Young says tax au­thor­i­ties have man­aged to close down many sys­tems used to lighten the tax bur­den.

Mike Crellin, di­rec­tor of UHY Hacker Young, said: “HMRC’s fo­cus on elim­i­nat­ing the use of tax avoid­ance schemes is de­liv­er­ing im­pres­sive re­sults.

“Fewer schemes are be­ing launched and HMRC is sweep­ing up more of the tax­pay­ers who have bought into these schemes.”

The com­pany said that in the year end­ing March 31, in­ves­ti­ga­tions had yielded £2.7bil­lion in tax.

Fig­ures for the pre­vi­ous year showed £1.8bil­lion was har­vested through in­quiries into avoid­ance schemes.

Scru­tiny of avoided in­come tax ac­counted for £1.5bil­lion (56 per cent) of the to­tal, com­pared to £753mil­lion (42 per cent) the pre­vi­ous year.

In­ge­nious Me­dia – the com­pany used by for­mer Eng­land cap­tain Beck­ham and TV pre­sen­ters Ant and Dec – helped clients re­duce their tax bur­den by us­ing their wealth to fund movies.

By in­vest­ing in more than 60 films in­clud­ing Avatar, the fa­mous names were able to qual­ify for tax re­lief.

In­ge­nious is cur­rently ap­peal­ing against HMRC’s de­ci­sion to ban favourable tax rates on the film in­vest­ments.

Mr Crellin said the tax­man also made a for­tune out of the Loan Charge scheme, by giv­ing work­ers who signed up a dead­line for pay­ment.


“The Loan Charge dead­line led to a bumper year for HMRC, but a lot of that money was squeezed out of tax­pay­ers who never re­alised they were buy­ing into a tax avoid­ance scheme.

“Many of those tax­pay­ers had to sell their assets to pay those crip­pling tax bills.

“No­body can fault HMRC’s tar­get­ing of tax avoid­ance, but many of its meth­ods are caus­ing some alarm.”

Celebri­ties in­vested in films like Avatar to re­duce tax bills

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