Tax-avoidance scheme challenged in tax tribunal

The Blue Box scheme, established by NT Advisors, is believed to have involved a charity in Northern Ireland called the Somerton Trust

NT Advisors
NT Advisors

A tax-avoidance scheme that acted as a precursor to the Cup Trust has been challenged at a tax tribunal.

The Blue Box scheme was designed by NT Advisors, which devised the Cup Trust tax-avoidance scheme, a tax tribunal heard yesterday.

Over two years, the charity the Cup Trust received more than £176m from donors and paid out only £55,000 to charitable causes, but attempted to claim £46m in Gift Aid. Donors might have been entitled to claim another £54m in tax relief.

It used a model in which donors gave money to the charity, received almost the same value of money in government gilts in exchange and claimed tax relief on the whole.

The Blue Box scheme, which was created in 2004, is believed to have used a similar methodology and to have involved a Northern Irish charity called the Somerton Trust.

According to The Times newspaper, the scheme is understood to have been used by about 60 people to protect about £100m from tax.

According to a National Audit Office report into Gift Aid, published last month, HM Revenue & Customs is investigating 1,800 avoidance cases related to eight marketed tax-avoidance schemes that use reliefs on donations and could result in lost tax of £217m.

The tax tribunal hearing continues.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in
Follow us on:
  • Facebook
  • LinkedIn
  • Twitter
  • Google +

Latest Jobs

RSS Feed

Third Sector Insight

Sponsored webcasts, surveys and expert reports from Third Sector partners

Markel

Expert Hub

Insurance advice from Markel

Managing risk at outdoor events

Managing risk at outdoor events

Partner Content: Presented By Markel

Voluntary and community events are increasingly popular, especially around this time of year.

Third Sector Logo

Get our bulletins. Read more articles. Join a growing community of Third Sector professionals

Register now