Won’t Ritchie enjoy this one?

A former BBC star claimed to be a second-hand car dealer in a failed attempt to avoid paying tax on £1 million by using a scheme that also attracted 450 other celebrities and members of the super-rich elite.

Chris Moyles, the ex-Radio 1 DJ, had his “highly artificial” bid to escape an estimated £400,000 income tax bill rejected by a tribunal on Friday.

Now all 450 of the top earners who joined the highly complicated “Working Wheels” tax avoidance scheme, understood to include fellow showbusiness personalities and fund managers, will be chased for the money they owe by HM Revenue and Customs (HMRC).

Moyles, 40, was one of the BBC’s highest-paid stars as the presenter of Radio 1’s Breakfast Show when he joined the scheme run by NT Advisers, whose initials stand for “no tax”, in 2007.

He filed a self-assessment tax return that claimed he had “engaged in self-employment as a used car trader” during the year to April 2008.


This will
be used as proof perfect that we need a GANTIP or whatever he’s calling it this week as it shows how many bastards there are trying to dodge tax.

He will, of course, ignore the fact that the current system has already caught this scheme and made it invalid. So there’s actually n need to change the law to catch schemes like this.

Not that that will stop him.

16 thoughts on “Won’t Ritchie enjoy this one?”

  1. Aren’t there actual issues raised by the Moyles affair.

    Yes, this clearly abusive scheme was stopped. But only after however many man hours of HMRC time and various court cases. Surely RM will argue that there may be many similar schemes not spotted by HMRC and that “cuts” to HMRC staff will only make things worse.

    Plus I think many will think that such a clear case of abuse (Moyles was clearly not running a 2nd hand car business, let alone one large enough to run up 100s of thousands of losses). Most will think this is fraud and should be prosecuted as such, not just “stopped”.

    Moyles was paid (say) £1m ps by the BBC. He knows perfectly well that he is expected to pay income tax of 40-50% on that. Sure, he knows he can offset certain expenses against that if he is self-employed, but not £1m by claiming to have pottered around selling a rusty Cortina to his brother.

  2. “Surely RM will argue that there may be many similar schemes not spotted by HMRC”

    He may do, and there may be. But in this case, the scheme was notified to HMRC by the scheme’s promoters themselves. People selling tax avoidance schemes are required to tell HMRC about them and how they work (and also their customer list), so that HMRC can get a head start on deciding whether it is legal or not, or change the rules. It sounds odd, but apparently the rules are called ‘DOTAS’ and this is how they operate.

    “Sure, he knows he can offset certain expenses against that if he is self-employed, but not £1m by claiming to have pottered around selling a rusty Cortina to his brother.”

    The scheme’s a lot more complicated than that. It involves at least three companies (more if subsidiaries count) and lots of rather contrived transactions between them. For example, one particular transaction is supposed to involve shares loaned prior to the issue of a dividend but because of ‘delays’ processing it, is timed to miss the dividend, for which the company pays a penalty fee several thousand times the lost interest. Extra payments in excess of normal interest are exceptionally counted for tax purposes as ‘fees’ and count as tax losses that can be set against income – this itself was a measure introduced as part of a change to close a different loophole.

    Basically, Moyles, like a lot of rich people, asked his accountant about legal ways to pay less tax. His accountant (presumably) advised him about the scheme, which Moyles claimed he was assured was legal (if sneaky), and he trusted them as tax experts.

    So far as I can follow it (and my head is still spinning after having just read about how it works), technically, on a literal and mechanical reading of the tax law (section 583, ITA 2007), it is. But it was obviously such an artificial and contrived scheme designed for no other purpose that the courts rejected it anyway.

  3. @NiV

    Thanks. I was being deliberately flippant with the “rusty Cortina” comment as the scheme was clearly more complicated than that. But, as you say, also clearly contrived.

    “His accountant (presumably) advised him about the scheme, which Moyles claimed he was assured was legal (if sneaky), and he trusted them as tax experts.”

    I suspect what the advisers said was that the scheme was “not illegal” or “we believe it to be legal and are awaiting HMRC to confirm this.”

    What is bizarre is that Moyles thought £1m in tax could be saved by not seemingly doing anything very much. At least if his advisers had bought him a 100,000 acre Scottish forest and said it came with generous green tax breaks that would be at least almost credible.

  4. As said above, this was under DOTAS so much of HMRCs work is done for them.

    Plus under new rules you’ll have to pay the tax that would be due if it failed in the courts before you can take it there or face penalties, so much of the benefit of trying and failing goes away.

    Thankfully we should hopefully see an end to these bullshit schemes and we can do our jobs properly without having to compete with snake oil salesmen who promise the earth and deliver little. Better still, Ritchies GRASSYBALLS contributes fuck all to the solution.

  5. @Shinsei1967, “But only after however many man hours of HMRC time and various court cases.”

    So we should allow the state to ride roughshod over the public and take away their money with no due process? It is right and proper that time is spent properly investigating cases and the courts used to ensure that everyone is handled in a fair and above board manner. Even if Ritchie’s laws were implemented, HMRC time would be spent investigating and court cases exist.

  6. Does make one wonder why the tax avoiding horde at the Beeb are so keen to have Murph on their programmes. An unfortunate accident in the car park involving a 3 ton limmo, a faulty reverse gear & good solid wall would seem a wiser option.
    I put it down to lack of enterprise in the public sector.

  7. SadButMadLad

    “So we should allow the state to ride roughshod over the public and take away their money with no due process?”

    You’re misinterpreting the point.

    The point being that dealing with this “clearly abusive” case involved hours of HMRC & Court time. It’s not as simple as saying “They were caught so everything is fine”.

    Preventing people from making “clearly abusive” claims in the first place would save everyone time and money better spent elsewhere.

    For instance, if Moyles’ advisers or Moyles himself were aware that setting up a “clearly fictitious 2nd hand car business solely to avoid tax” were to be treated as fraud then they wouldn’t go ahead with it in the first place.

    We have laws against benefit fraud. If you are claiming (physical) disability allowance and are then photographed doing a triathlon you’ll find yourself in court. You can’t just ask for a ruling on whether it was illegal and then pay the money back with a “sorry”.

  8. Shinsei 1967

    A techincal point:

    ‘I suspect what the advisers said was that the scheme was “not illegal” or “we believe it to be legal and are awaiting HMRC to confirm this.”’

    No, I don’t think they would ever say something like that. These guys are professionals, they simply wouldn’t enage in anything they didn’t believe was ‘legal’. They might well advise their client that they couldn’t guarantee the scheme would work, that it might not achieve the desired tax effect. The legality of it though would absolutely clear to them or they wouldn’t proceed. That is how these schemes work.

    That said, highly artificial arrangements do run the risk of having steps inserted that are simply false. They all work by having a series of documents that all purport to so do something and which do, looked at in isolation, have particualr legal effects, but which when looked at in the round achieve a quite different effect and are intended to achieve a quite different effect. For those interested the “Round The World” or “Sunset” scheme involving moving trusts through different jurisdictions is a good example. Here, however, (and I don’t know this scheme)there has been a reference to ‘delays’ in processing dividends. This step would appear to have a different quality. But I emphasise, I do not know the details here and only have what I have just read from NiV.

  9. So Much for Subtlety

    Tim Newman – “Chris Moyles vs HMRC? Shame they can’t both lose…”

    HMRC employs 67,000 joyless officious little pr!cks who signed up despite knowing everyone hates them. Chris Moyles is Chris Moyles.

    A little hard to decide which represents the larger C*ntishness actually.

  10. It would be easier just to jail all BBC disc jockeys, and sort out which are perverts and which tax evaders afterwards.

  11. Too bad they didn’t pay the fee and get one of those Fair Tax mark thingys from Ritchie.

    They could have waved that at HMRC and all would have been well.

  12. Shinsei1967
    “What is bizarre is that Moyles thought £1m in tax could be saved by not seemingly doing anything very much.”

    A lot of people believe that using an accountant allows you to just avoid very large amounts of tax, esp. people who are bought up on a diet of the Guardian. Of course it’s not true, but a scheme like this would be exactly what your average Guardian reading playwright or actor would expect. The fact it involves them lying through their eye teeth and fails a sniff test are things they would miss IME.

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