Revenue fears loss of €110m tax, court hears
A SCHEME allegedly involving 26 wealthy individuals was a tax-avoidance measure that could result in up to €110m of tax lost to the State, it has been claimed in documents put before the Commercial Court.
The claim is made by the Revenue in an action by four businessmen, who are challenging the issuing of formal Revenue opinions that their claims for substantial capital-gains losses should be disallowed.
The scheme, related to the 26 high net-worth individuals, could involve losses to the Revenue of between €85m and €110m, according to some documents.
It is claimed the Revenue identified about 26 cases in which identical or very similar arrangements were concluded via a London-based global-assets management company and that it referred to these as the "Schroders Ready-Made 26". The scheme was investigated by the Revenue's Large Cases Division and reports were provided to the three Revenue Commissioners themselves, according to documents.
Of the 26, six had used 'straddle' transactions. while 20 used a combination of gilt instruments and Contracts for Difference, the court heard.
Michael Collins SC, for the four businessmen, argued that the Revenue was required to issue those formal notices once it had decided that a tax advantage was being gained from a transaction.
The challenges by the four -- Ronan McNamee, of Temple Road, Dartry, Co Dublin; Derek Whelan, of Foxrock Manor, Foxrock, Dublin; John Punch, of The Park, Cobh, Co Cork; and Martin Punch, of The Fountain, Glanmire, Co Cork -- are expected to decide issues affecting all 26 individuals, with claims up to a total of €110m.
The hearing continues.