Ingenious, HSBC, UBS and Coutts sued by ‘tax avoidance’ clients

Private client banks such as Royal Bank of Scotland’s Coutts, HSBC and UBS have been sued by clients for wrongly advising them to invest in film investment specialist Ingenious as its schemes have since been labelled by tax authorities as tax-avoidance vehicles.

Ingenious Media and around 50 other associated financial firms have been slapped with a High Court writ by more than a hundred investors who claim they were wrongly advised to enter the schemes without being made aware of the risks involved, the Mail on Sunday reported.

Several investors faced surprise tax bills for millions of pounds after HM Revenue & Customs last year sent out accelerated notices demanding payment.

The tax authority ruled that Ingenious’s film investment schemes, which provide an opportunity to defer tax in return for investing in its film production fund, were ostensibly just a means of avoiding tax.

A dispute by the company led to a tax tribunal this year which is still ongoing.

Ingenious’s current schemes include the Ingenious Broadcasting 2016/16 fund, where for a minimum £50,000 investors are offered “projected tax free returns of between 8% and 16% per annum”.

The company said Ingenious Broadcasting has capitalised over 200 companies and all 130 companies that have reached their three year anniversaries have returned, or are on track to return, funds to investors within six months and have generated net average annual returns ranging from 4% to 12%.

HSBC earlier this year issued a public apology after its Swiss arm was accused of helped clients evade tax, with an investigation also made into operations both in the UK and abroad.

The Royal Bank of Scotland’s Swiss private banking arm also came under investigation by European authorities.