Billionaire Michael Platt's BlueCrest Capital Management has declared that the UK is “no longer a serious contender” as a place to do business after losing a £200 million legal battle against the UK tax authorities. On Wednesday, the firm lost a roughly four-year legal battle concerning how payouts for hedge fund traders should be taxed.
Supreme Court Ruling
The Supreme Court unanimously dismissed BlueCrest's appeal in its case against Her Majesty’s Revenue & Customs (HMRC). The legislation in question determined whether a member of a limited liability partnership should be considered a partner or an employee for income tax and national insurance contributions. The court ruled that most of the payments were “disguised salary,” not based solely on the partnership's profit or losses.
BlueCrest's Response
Following the decision, BlueCrest stated that it believes HMRC’s published guidance “was wrong.” In a statement, the firm added: “Businesses operating in the UK need to be able to rely on HMRC’s guidance to organise their tax affairs with certainty. Without that certainty, and in an increasingly competitive global market, the UK is no longer a serious contender as a jurisdiction in which to do business.”
Background
BlueCrest was founded in 2000 by Michael Platt and fellow trader William Reeves. The firm is the latest to criticise UK tax policy, claiming it is impacted by a perceived unfair tax system. The case has drawn attention to the broader business climate in the UK.
