dj chris moyles and former liontrust manager (1)

A tax avoidance scheme used by celebrities and fund managers, including one-time Radio 1 DJ Chris Moyles and former Liontrust fund manager Eoghan Flanagan, has been closed down by HMRC.

dj chris moyles and former liontrust manager (1)

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The scheme was created by NT Advisors, a firm which has lost four consecutive cases against the Revenue in recent months, and involved subscribers claiming they were second-hand car dealers in their spare time.

According to HM Revenue & Customs, the tribunal’s decision will save the UK bourse £290m.

Between 2006 and 2008, NT Advisors sold the scheme, called “Working Wheels” to 450 fund managers, celebrities and other high earners.

Under the scheme, those involved, including Moyles and Flanagan, who was also a co-founder of Berkeley Square based-hedge fund specialist, Thames River Nevsky, tried to claim they were “in the second hand car trade”.

HMRC said the First Tier Tribunal found on its side on all the arguments and dismissed this “highly artificial scheme outright”.

The tribunal added that “a realistic view of the facts showed that the appellants’ aim was to make it appear, ‘as though by magic’, that they had incurred vast fees in order to borrow modest amounts of money they did not need in order to invest it in a ‘trade’ they had no desire to pursue”.

Exchequer Secretary David Gauke said: “This case is another example of why taxpayers should not fall for the promises of promoters selling schemes that are all too often too good to be true. Not only will the taxpayer waste money on the fees for these failed schemes, they will still have to pay all the tax, interest and penalties that are due.

“This government has provided HMRC with the resources to tackle these avoidance schemes and HMRC will now pursue the other users of the scheme to make sure all the taxes that are due are paid.”

Only last month, NT Advisors lost another case against HMRC involving a scheme which would have cost the UK taxpayer around £100m in lost tax. Click here to read more

As reported today, HMRC is consulting on changes to the tax dispute process, which would make it a requirement for disputed tax to be paid before a final decision is reached by the courts. Click here to read about the consultation

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