Is your £14m tax scheme Strictly kosher, Tess?
STRICTLY Come Dancing presenter Tess Daly and her TV star husband Vernon Kay are at the centre of a suspected ‘tax avoidance’ probe, with a multi-million-pound investment scheme they joined being investigated by the taxman.
The wealthy couple, along with BBC Radio 2 DJ Dermot O’Leary and former pop star Rachel Stevens, are members of the £14 million Beaumont Film Partnership.
This is a scheme that uses a complex arrangement to allow investors to defer income tax bills over 15 years. Such schemes are intended to boost the British film industry, but similar partnerships have been successfully challenged in the courts by Her Majesty’s Revenue & Customs as being designed to avoid tax. Millions have been clawed back into public coffers.
Ms Daly and Mr Kay – who married in 2003 and have two daughters – are among more than 50 investors who could face tax bills and possible penalties if Beaumont suffers the same fate. Others include Labour-supporting TV presenter June Sarpong and Royal Mail’s new chairman Peter Long. A long list of celebrities have previously been named as members of a variety of alleged ‘tax avoidance’ schemes in recent years. They include Take That stars Gary Barlow, Mark Owen and Howard Donald, comic Jimmy Carr and the Beckhams.
There is no suggestion that any criminal offences took place.
Among those who managed Beaumont Film Partnership is former accountant and discharged bankrupt John Dryburgh, 56. A different tax avoidance scheme he ran was closed down by a tax tribunal in 2013 which left his reputation damaged.
Like Ms Daly and Mr Kay, Mr Dryburgh lives in the stockbroker belt town of Beaconsfield, Buckinghamshire, in a £3million detached house. Last night he said he had no involvement in recruiting investors into the Beaumont scheme and could not say which films had been financed by the partnership.
He admitted Beaumont was subject to an inquiry but added: ‘It’s all been agreed with HMRC, as far as I know, and I’m confident it will be closed off once they’ve decided what to do about other cases.’
He said HMRC was making some small adjustments to the reliefs the partners had claimed and HMRC had not asked for partners to pay money back up front.
Ms Daly, 46, whose contract with Strictly is said to be worth £250,000 a year, was made the new face of L’Oreal in 2013 for the reported sum of £300,000, alongside Cheryl Fernandez-Versini.
In 2010, Ms Daly attacked inheritance tax, describing it as ‘disgraceful’ and ‘effectively triple taxation’. It is understood she has since changed her views on the subject. Mr Kay, 41, is best known as presenter of All Star Family Fortunes. The couple first invested in Beau- mont in April 2004, a few months before buying their home for just under £1.2 million. It is not known how much any of the investors have channelled into Beaumont, which was described by Mr Dryburgh as a ‘bog-standard sale and lease-back scheme’. More than 1,000 people who invested in tax and property schemes like the Beaumont Film Partnership are taking action against independent financial advisors and others who put them into the arrangements.
Martin Taylor, head of client relations at Rebus Investment Group, which is bringing actions on behalf of investers, said: ‘We understand the Beaumont scheme is the subject of an open inquiry by HMRC.
‘In many cases, investors were not told of the risks posed by these schemes and they are now having to deal with the consequences.’
The investors save tax through a complex web of deals using special tax breaks. They borrow a large sum of money and use it to buy the rights to a film or films. Rules to encourage investment in films allows them to deduct the cost of this investment from their income tax bills. Over 15 years, they have to pay tax on the income they get from the film. In the meantime, they invest elsewhere the money they saved from their tax bill. Ideally this far outweighs the tax payable on film income. A spokesman for Mr O’Leary said: ‘HMRC do not have any open inquiries relating to Dermot’s personal tax affairs. All Dermot’s accounts, tax returns and tax payments are fully up to date. By investing in Beaumont over ten years ago, Dermot has not avoided any tax.’
Spokesmen for Ms Daly, Mr Kay and Ms Stevens and Royal Mail declined to comment. Miss Sarpong could not be reached for comment. HMRC declined to comment.