Readers' forum : Red light

I have a disadvantaged client who was ‘talked into’ an investment in a company that promotes and operates airport car parking schemes.

My client decided to invest £100 000 in this scheme and has received income of £10 000 in 2015-16 and £6 000 in 2016-17.

This income relates to the letting of specific car park space leases so I recorded it as rent on the respective tax returns.

The Financial Conduct Authority has now become involved and has taken the view that the scheme was a collective investment scheme and that the company was not authorised or permitted to provide this investment facility. The company saw a red light and one of the options offered to investors is to repay the capital investment less all rent paid to date plus a 2% interest payment for the period my client has owned car park space leases. This will take...