Magazine article Screen International

Film Tax Avoidance Scheme Closed

Magazine article Screen International

Film Tax Avoidance Scheme Closed

Article excerpt

A film tax avoidance scheme which routed profits of a tax advisory business through employee benefit trusts has been closed by a tribunal.

HM Revenue and Customs (HMRC) challenged tax deductions of almost £9m ($14m) which tax advisor John Dryburgh's companies, Scotts Atlantic Management Ltd and Scotts Film Management Ltd, paid into Employee Benefit Trusts.

According to HMRC, the tax avoidance involved trying to extract profits from companies while at the same time securing corporation tax deductions. Employers paid money into an Employee Benefit Trust (EBT) and claimed corporation tax deductions. The EBT gave undervalued shares in a new company, causing a loss to the employer.

The Tribunal said: "There is no doubt that Mr Dryburgh not only lied to the Tribunal in a material way, but he appeared also to have fabricated evidence, forged documents and thrown away a memory stick in order to destroy evidence. …

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