Bloomberg News has reported that FTSE-listed Ladbrokes Coral Plc is set to take its £70 million overturned UK Revenue & Customs (HMRC) ‘2008 tax avoidance’ dispute to the UK Court of Appeal (the UK’s second highest law court).
The betting group targets a February date for the Court of Appeal to rehear its arguments against HMRC, who had charged Ladbrokes of ‘knowingly exploiting a 2008 tax loophole relating to loans between corporations and third parties’ in order to minimise Ladbrokes full-year tax bill.
Last February, a newly merged Ladbrokes Coral lost its three-year-long appeal at the UK Tribunal Court who sided with HMRC’s initial claim against Ladbrokes. In March, the betting firm would be granted the right to appeal its dispute to a higher UK law court.
The tax avoidance case relates to a 2008 scheme implemented by accountancy firm Deloitte who advised a number of its partners to ‘deliberately’ create ‘transacting subsidiaries’, in order to shift corporate tax charges under a single ‘loss generating’ business unit.
HMRC stated that during the 2008 fiscal period, Ladbrokes Group suffered no actual losses and used the loophole to avoid paying corporate taxes, further detailing that nine corporations which used the same type of scheme had conceded to the Tribunal and paid the taxes owed.
Countering HMRC’s arguments, Ladbrokes legal teams conceded that the scheme was implemented to ‘avoid tax’, however, the gambling firm stated that at the time its operational arrangements fell outside the scope of anti-avoidance rules.