29-11-2016

Rupert Grint and the Strange Accounting Case

In and out of the news this year has been Rupert Grint, the actor who played Harry Potter’s best mate, Ron Weasley, in the eight big screen adaptations of J. K. Rowling’s fantasy series, released between 2001 and 2011.

Unsurprisingly, Grint made a considerable amount of money whilst starring in one of the most successful film franchises of all time, reportedly around £24 million in total. But the actor made headlines in June by taking HMRC to court in an attempt to have around £1 million of tax payments refunded.

Grint’s case stems from his attempt to shield his earnings from the higher tax rate of 50% which came into force during the 2010-11 financial year. His accountants, Clay & Associates, had advised the actor to move eight months of income into the 2009-10 tax year in order to pay tax at the previous rate of 40%. They attempted to do this by using a shorter accounting period of around eight months from 31st July 2009 to 5th April 2010, with the intention that the earnings from that period would avoid being taxed on the higher rate.

The case was made by Grint’s lawyers that there was nothing improper about the change of date. HMRC argued that the change had been rejected after they had discovered an accounting document which showed a different date during a routine VAT inspection unrelated to Grint’s tax returns. Grint’s lawyers responded that the document in question was an informal summary and did not constitute an official set of accounts.

If you have any questions about taxation, or need financial advice please feel free to get in touch with us directly on 01246 560570 or email info@bannerjoneswm.co.uk.