In an article published by the newspaper late last year, the FT claimed that HMRC had written to clients of Montpelier Tax Consultants, warning them they are to be investigated for their use of a scheme between 2004 and 2005.
The scheme in question involved using financial derivative products called “contracts for differences” and it is understood that those who used the scheme are considered sophisticated investors by HMRC.
The investigations into the investors follow raids on the London and Isle of Man offices of Montpelier in September 2010 by HMRC and police officers from the Isle of Man’s Financial Crime Unit.
An HMRC spokesperson said at the time: “…search warrants were served on premises in the UK and Isle of Man and a man, aged 60, was arrested in connection with an ongoing criminal investigation.
“The investigation centres around the suspicion that tax avoidance schemes (sold to over 600 subscribers) have been implemented fraudulently, with an estimated tax loss in excess of £90m. HMRC would like to thank the Isle of Man authorities for their co-operation and assistance in this enquiry.”
It later transpired that the arrested man was Watkin Gittins, a director of Montpelier.
The company later successfully challenged the warrant used to search its Isle of Man office, although it failed to challenge the warrant used in the UK.
HMRC’s intention to investigate the individual investors involved with the scheme marks a change of tactic for the government agency, which has been scaling up its tackling of avoidance over the past few years.
