Offshore tax dodgers face £100m bill after court ruling
Share
HM Revenue & Customs has won a High Court ruling allowing them to seek £100m of back-dated income tax from around 2,500 people who used an offshore tax avoidance scheme.
Self employed IT contractor Robert Huitson brought the test case and faces a tax bill of £100,000 after using an Isle of Man scheme which allowed him to receive an annual fee of £15,000 plus a further sum as owner of a life interest in an offshore trust, according to the Financial Times.
According to the FT report Huitson avoided income tax of £84,890 over seven years and reduced his effective tax rate to 3.5 per cent. It says earlier court hearings revealed that fifty seven other people who used the scheme could not meet tax demands even if they were to sell assets including family homes.
If you enjoyed this article, sign up here to receive daily email updates from Money Marketing and Follow @_moneymarketing
Readers' comments (1)
NJH | 29 Jan 2010 2:38 pm
A few things spring to mind here. The first being that this 'Scheme' must have been marketed to UK based individuals and therefore the Provider would hopefully have fully investigated tax issues and had suitable warnings in product information. The second is that it is possible that a number of those individuals sought independent financial advice regarding the suitability of the arrangement, which should have included tax implications. The very nature of the term 'tax avoidance' rather than tax planning is an issue - but hopefully the innocent investors will get some redress from their IFA or the provider itself. As to the others, well its again a case of 'caveat emptor' and - if something seems too good to be true......its probably illegal, so don't touch it with a bargepole. When will they learn.
Unsuitable or offensive? Report this comment