Business executives and sport stars - among them David Beckham - have been warned they must pay HM Revenue and Customs more than £520m after a government crackdown on tax avoidance schemes.
Former England star Beckham (pictured), alongside other famous faces including Dame Clara Furse of the Bank of England's Financial Policy Committee, and Lord Hollick the financier and former media boss, have all been warned by investment company Ingenious Media they could face hefty tax bills, the FT reports.
Ingenious Media allowed its clients to invest in films through partnerships. While these made early losses of £1.3bn, investors could then offset their losses against their other income and consequently reduce tax bills.
But the firm has now issued a warning to 1,300 past and present investors, telling them they are likely to be required to repay all the tax they have saved, and possibly interest on top. Clients are expected to receive bills ranging from thousands to millions of pounds before the end of the month.
The crackdown comes after the Treasury tightened rules on film investment schemes in 2007. This led Ingenious Media to diversify its offering for investors, so as well as funding films, it also moved into property renovation and clean energy projects.
But under a new accelerated payment plan, the Treasury is now demanding investors involved in a tax avoidance dispute pay the tax under consideration upfront.
Investors must either reach an immediate settlement with Revenue & Customs or fight the ruling via the courts.
Ingenious warned its investors time was running out if they wanted to take up a settlement offer from HMRC. The offer is thought to cut their bills by up to 40% by allowing them tax relief on the cash element of their investment but not the part funded by borrowings.
Ingenious told clients they have a short time to take up a settlement offer. It said: "We have done everything we can to lobby for changes to the accelerated payment proposals as the Bill has progressed through Parliament, but without success.”
