Friday, 22 May 2015
Last updated 1 hour ago
Mar 4 2013 | 12:43pm ET
The Children's Investment Fund co-founder Patrick Degorce is staring at a huge tax bill after British authorities successfully argued that he used an impermissible tax shelter.
Degorce, who now runs his own hedge fund, Thélème Partners, was ordered to pay £7.5 million. A Tax Tribunal Friday rejected his claims that he properly offset some £18.8 million in profits from his hedge fund with a loss on film rights investments.
The U.K.'s Revenue & Customs said that Degorce bought the rights to two feature films at an inflated price from Goldcrest Pictures, but only actually put up about a quarter of the money, and then sold the rights back to Goldcrest for a fraction of the inflated price of £21.9 million. Degorce actually paid only £4.8 million for the rights, HMRC alleged.
A spokeswoman for Degorce told the Financial Times that he would appeal the ruling, which is "riddled with errors." Degorce was advised on the deal by HSBC Private Bank, which earned £438,469 for its services.
"Mr. Degorce put in nearly £5 million of his own money," HMRC business-tax chief Jim Harra said. "But all he has come away with is an HMRC enquiry and an appearance before a tax tribunal."
"The government has made it clear that we will not allow marketed avoidance schemes to deprive the U.K. of vital tax revenues," David Gauke, exchequer secretary to the Treasury, added. "The government has invested nearly £1 billion in the fight against the minority of taxpayers who think they are above the law. We are bringing in anti-avoidance legislation and we are giving HMRC greater powers to clamp down on those who sell dubious avoidance schemes like this one."
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…