Montpelier DTA Scheme – Case Update

WTT Group’s Graham Webber, Director of Tax, offers an update on the Montpelier DTA Scheme

26th April 2024

The Montpelier group of companies, originating from the Isle of Man but with many active UK entities, operated a range of contractor schemes from perhaps 2004.

The earliest of these was an arrangement that exploited a lacunae in the double tax treaty between the UK and the IOM. This became known as the “DTA scheme”. This scheme was eventually stopped in March 2008 by HMRC persuading Parliament to make retrospective law changes. That legislative change sparked a number of legal challenges in the tax Tribunals and elsewhere which until recently were considered to have reached a conclusion some years ago. Indeed HMRC has issued Follower Notices and related demands based on the “final” decision.

It’s also true that the original group of users of the scheme was divided as to how to defend the arrangement. The group that stayed with the “advice” from Montpelier saw their challenge end as above. The group that decides a different strategy was better remains in the field, fighting, and are awaiting their appeal to be heard in the Upper Tier Tribunal. That case has a significant number of individuals attached to it but is, we understand, unable now to admit new members.

Finally, in the years since the scheme was extant and the defences made, it would be correct to say that the Montpelier Groups’ fortunes have not prospered. The decline in the reputation and standing of the Group has led to the users of the arrangements being more or less left to their own devices with promises of “legal action” remaining unfulfilled. 

Now however it appears that the Tribunal has taken it upon themselves to review a number of related cases and to offer the individuals an opportunity to reinstate appeals. 

A request for reinstatement must be made before  8 May 2024.

WTT is considering whether such a reinstatement would be in the best interests of taxpayers (some of whom are clients). That has many elements to weigh in the balance one of which is whether sufficient numbers of individuals could be brought together to make the expected cost of an action viable.

This is therefore a call for anybody who may have had a letter from the Tribunal, dated 10 April 2024, which covers the above, to get in touch for a discussion. There is no fee for this discussion and no commitment is requested. This is very much an exploratory discussion on all sides.

Contact Our Specialists Today

If you have been involved with the Montpelier DTA scheme and have received a letter from Tribunal dated 10 April 2024, we can help. get in touch with our experts today.