The settlement opportunity for members of Eclipse Film LLP

The new settlement opportunity for members of Eclipse Film LLP was reported in Taxation 16 September 2021 page 5. The first part of this article briefly reviews the nature of the opportunity. The second part suggests that the decision to offer this opportunity raises wider questions about how HMRC interacts with different taxpayers and in particular how its litigation and settlement strategy (LSS) is being operated.

The new settlement opportunity is available to present and past members of Eclipse Film Partners (Nos 1 to 40) LLPs. It is open to members within a six-month window of being contacted by HMRC. In brief members purchased various film rights including a right to income on distribution. The purchase was largely (sometimes over 90%) financed by bank borrowings. Members made a prepayment of interest of several years. The number of years varied but in Eclipse 35 it...