The bar­ris­ter’s ‘le­gal opin­ion’ be­hind the tax dodge was forged

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claims to be able to save a buyer of a £1m sec­ond home £43,328 in stamp duty. Mr Con­nolly in­sisted the strate­gies de­ployed by Fidu­cia Wealth & Tax were en­tirely le­gal. He said: “Touch wood, our bar­ris­ters and ac­coun­tants are as good as it gets.”

In an­other on­go­ing case that went to a tax tri­bunal, the pa­pers of which were pub­lished last month, four con­nected com­pa­nies of­fer­ing stamp duty avoid­ance ser­vices went into liquidation when their schemes failed, leav­ing 3,000 cus­tomers out of pocket and at risk of fines.

In­ven­tive Tax Strate­gies, Pro­fes­sional Ad­vice Bureau, Ster­ling Tax Strate­gies and Bell Strate­gies had promised to re­fund cus­tomers’ fees if their tax­bust­ing strate­gies failed, but were un­able to do so.

Two in­sur­ance poli­cies taken out with a com­pany based in Belize also failed to pay out. In a fur­ther twist, court pa­pers show the com­pa­nies made ap­pli­ca­tions to HMRC for VAT re­funds in or­der to pay their cred­i­tors – lead­ing the tax­man to make pay­ments to­talling more than £3m. HMRC later re­alised its mis­take and blocked fur­ther re­quests for a sum of £2.1m.

ITS Ac­tion Group now rep­re­sents a num­ber of the four com­pa­nies’ cus­tomers, who have been made cred­i­tors by the ad­min­is­tra­tors.

A spokesman for HMRC said: “Most avoid­ance schemes sim­ply do not work, and the peo­ple who get in­volved can end up pay­ing more than they were try­ing to avoid in their mis­guided at­tempts to save money.”

He added that a “scheme ref­er­ence num­ber” – a ref­er­ence for HMRC – does not mean it has been cleared by the tax­man. Schemes must al­ways be dis­closed.

Paul Emery, a part­ner at PwC, the ac­coun­tancy firm, said new rules re­quir­ing any­one us­ing a scheme to mit­i­gate tax to dis­close de­tails to HMRC were cur­tail­ing these sorts of cases, not­ing: “HMRC is also us­ing Land Reg­istry data and match­ing this up with tax re­turns.”

He added: “It can be dif­fi­cult to dis­cern le­git­i­mate plan­ning from some­thing the courts are likely to find against. If it does sound too good to be true, get a sec­ond opin­ion from a pro­fes­sional.”

The Fidu­cia men­tioned here is in no way con­nected with Colch­ester­based Fidu­cia Wealth Man­age­ment

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