Studio Tax Avoidance

Media Interviews

Letters to the Editor
Published on 2 March 2018

As published in City A.M.


A number of recent headlines have not captured the real detail behind film partnerships. I have some sympathy for Charles Randell, the new chairman of the FCA who has been mixed up in this tax avoidance scheme. He was ill-advised to enter into film partnerships, which were sold by people who appeared to be giving advice when in fact they were selling products. This latter point has, of course, been responsible for many of the maleficences in the retail financial services industry, including pension mis-selling and the like. It is commendable that Randell has fired his financial “adviser”, and repaid the money, which was an honourable action.

The government should apologise for making these schemes available, and so should the product pushers for “peddling” them without much thought to the consequences.

In the early days of film schemes, I set aside time to research them. My conclusion was that they were to be avoided on the basis that they were effectively either a loan from the government or a “punt” on films. If I wanted the former, I’d go to a bank or building society, and the latter I’d invest in something like Walt Disney shares. The very fact they were a complicated tax scheme said it all to me. My advice to avoid them like the plague was based on a number of time-worn principles of investing, which have proven fruitful for many over the years.

This latest episode involving film partnerships proves that the old adage about not letting the tax tail wag the investment dog remains valid. A second lesson is not to invest in something that you don’t fundamentally understand. I believe that this episode will have provided Randell with some good insights into the retail financial services world, which he is now responsible for regulating.


Nicholas M R Fletcher, Chief Executive, London Wall Partners LLP