As the controversy over the tax arrangements behind various UK film finance schemes continues, leading UK film financier Ingenious has confirmed today that it is beginning legal action against both The Times and Her Majesty’s Revenue and Customs (HMRC).
Its decision comes in the wake of articles published in the Times newspaper last month as part of a series on tax avoidance in the UK.
A company spokesperson has confirmed Ingenious is taking further legal advice and has now sent letters to both the Times and HMRC.
Ingenious has taken exception to “insinuations” about some of the company’s Film Partnerships. In a statement posted on its own website today, the financier has again proclaimed that it has “never been in the business of tax avoidance.”
“Grotesquely unfair and a seriously damaging impact,” a source stated of the the allegations that film schemes are a £5 billion risk for the Revenue.
In its statement, Ingenious has insisted that its Film Sale & leaseback partnerships were established as a direct result of Government legislation to stimulate the British film industry.
“This government sponsored initiative brought much needed investment into the flagship industry of the UK’s flourishing creative sector,” the statement reads. “It did so by creating for film investors a deferral of tax, not the avoidance of it. Our partnerships not only operated in accordance with the legislation, complying fully with detailed guidance notes published by HMRC, they also subsequently received HMRC approval.”
Ingenious has also dismissed the inference that partnership income was transferred overseas.
Noting that its “dealings with HMRC have always been fully transparent,” Ingenious pointed out that through the 100 films to date it has financed, £600m of taxable receipts have already been generated “with a further £1billion of taxable receipts expected to be generated over the commercial life of these films.”
