It was interesting to look at the reaction from professional advisers after the Supreme Court refused a film financing company’s request to appeal a ruling that it fell foul of the usual tax rules.
The ruling – handed down by Lord Neuberger, the court’s president – is the end of the appeal line for the scheme and likely to land many of its high-profile members, such as Sven Goran Eriksson and Sir Alex Ferguson, the football managers, with large bills for unpaid taxes.
Attention is now directed, and we have always said this from day one and we believe it will go on for the next 10 years, with various claims against the lawyers and accountants who advised that the Eclipse Film Partners scheme was acceptable in UK tax terms.
As reported in The Brief on 12 May 2016 a law firm, Clarke Willmott, is acting on behalf of several investors in court actions against those who advised them.
A spokesman said: “This will come as a crushing blow to the investors in the Eclipse schemes.”
Lawyers for investors claim that the “enormous” commissions paid by those who introduced their clients to these schemes may have dulled the alarm bells which ought to have been ringing in those advisors’ ears about the structure of the scheme.
The old say “it sounds too good to be true” certainly works here.
Further criticism of the advisors say that it is almost unbelievable that any investor went into these schemes fully understanding the extent of the potential liability they could face if it failed.
Most investments were sold in 2006 and 2007 and even then the threat that HMRC would attack these schemes was very real indeed.
We have always said these schemes would not hold up in the end.
KinsellaTax are negotiating for a number of investors with HMRC for repayment terms without the necessity of going bankrupt and losing their businesses.