An investigation has revealed that a tax avoidance scheme provided by Jersey based Liberty enabled £1.2 billion to be sheltered from HMRC for four years.
Between 2004 – 2008, band members of Take That; Gary Barlow, Mark Owen and Howard Donald; together with quiz master of the BBC's 'The Weakest Link', Anne Robinson, invested thousands of pounds into the scheme in return for huge tax savings according to The Times.
The Liberty scheme closed down following the introduction of new legislation but during its existence approximately 2,000 people participated in the scheme which created artificial losses by virtue of buying and selling dividends. The losses could then be relieved against the individual's own tax liability. Scheme members paying in £70,000 could achieve a return of £1 million, tax free.
It is believed by The Times that Anne Robinson parted with £280,000 in order to save tax on around £4 million and that Gary Barlow handed over £210,000 to Mercury Tax Strategies, which ran the scheme, to ring fence £3 million from the Revenue. The Times also reported that Mark Owen and Howard Donald sought to shelter £1.4 million and £2.1 million, respectively.
The Liberty scheme came to the attention of HMRC in 2006 and now a First Tier Tax Tribunal hearing is expected for the spring of next year. None of the investors are expected to be named in the hearings.
Although there is no indication at this stage as to what yield HMRC expect to achieve, it is estimated that £300 million per annum was shielded by the scheme.
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