Incoming FCA chair admits using tax avoidance scheme

By Kirsten Hastings, 21 Feb 18

The next chair of the UK’s Financial Conduct Authority said he made an “error in judgement” when he used a tax avoidance film scheme promoted by Ingenious, a firm that has lost several court battles against HM Revenue & Customs.

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Tax reliefs on a tax form

Ingenious

Ingenious Media was founded in 1998 and has four operating divisions; investments, ventures, asset management and corporate finance.

In August 2016, Ingenious lost a case against HMRC which said it used artificial losses arising from investments in a range of films, including blockbusters Avatar, Life of Pi and Die Hard 4.0, to claim tax relief.

The First Tier Tax Tribunal ruled that the investors should only receive relief on 30% of their investment, not 100% as was claimed.

The result was a £700m tax bill for the many famous actors and footballers that invested with Ingenious.

In May 2017, Ingenious appealed the ruling but it was struck down, despite the judge admitting to having “misgivings and reluctance” over the decision.

A further appeal was lodged the following month.

A group of celebrities, including ex-Premier League footballers, launched their own case against the financial advisers who recommended the scheme in September.

They were unsuccessful.