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A tax avoidance scheme sold by serial avoidance promoter NT Advisors has lost its third bid for legitimacy, saving the country £100 million.
Matthew Jenner devised the complex scheme, branded Project Corbiere, for NT Advisors and pitched it to the wealthy. It involved transferring millions of pounds of UK government bonds, known as gilts, backwards and forwards to the British Virgin Islands to manufacture an unwarranted tax deduction of £1.2 million. The Court of Appeal said the scheme was specifically designed to avoid tax.
Some of the 230 wealthy individuals who first used the scheme in 2005 have settled their tax bills with HM Revenue and Customs (HMRC) but about £80 million could have been lost to the UK if this latest appeal had been successful. The First-tier and Upper Tribunals and the Court of Appeal have all now ruled in HMRC’s favour.
Eighteen individuals have already paid a total of £20 million to settle their tax bills.
Exchequer Secretary to the Treasury David Gauke said:
This is an important win for HMRC and is the latest in a string of successes. It is excellent news for the vast majority of taxpayers who play by the rules.
Many users of this scheme have already accepted the inevitable and settled up with HMRC and those who haven’t should do so quickly.
This government has provided HMRC with nearly £1 billion to clamp down on tax avoidance, evasion and fraud. We recently announced proposals which will give HMRC stronger powers to tackle promoters and users of avoidance schemes sending a clear signal that tax avoidance doesn’t pay.
More information on this case
The judgement in Nicholas Barnes v Revenue and Customs  EWCA Civ 31 can be read at www.bailii.org/ew/cases/EWCA/Civ/2014/31.html