Invest £10,000 NOW, obtain £10,000 in tax relief and look forward to a further £10,000 return in 6 years time. Ideal for high rate taxpayers.

Whilst this scheme has short term tax benefits, it is the commercials that make it interesting

Potentially every high rate tax paying business or investment minded individual should have one of these. Convinced by its integrity and potential excellent returns, our principal has invested in similar arrangements with this Provider for the last 3 years.

It is an investment into the equity of a range of mainstream movies. Past projects are currently involved with:

The slate of movies for investment in the 07-08 year included Easy Virtue starring Kristin Scott Thomas & Colin Firth, 44 Inch Chest with Ray Winstone & John Hurt, Grimm starring Bruce Willis and Blown with Samuel L Jackson and Guy Pearce

A good way of looking at this one is:

1.      The £10,000 minimum investment into equity aims to be returned in 6 years. The sales income of a set of movies need only return 50% of the partnership investment over 6 years in order to return 100% of the investment to the investor. For example, if a movie costs £10,000,000, then sales returns of only £5,000,000 are required over 6 years to return the invested amount. This is because of the special terms the investment manager negotiates with the other equity holders. And then:-

2.      In addition, £25,000 of losses incurred in the production of the movies will occur this tax year.  This has two effects:

a)   For PAYE / self-employed: either up to £10,000 tax rebate from putting these losses against either this year's, last year's or the 2004-5 tax year's taxable income OR a further £10,000 return in 6 years time (i.e. twice your money back if no tax rebates are claimed now). If you are able to reclaim the £10,000 tax rebate quickly then the investment will look like something close to a zero cost investment with a potential to receive back £10,000+ in 6 years time

b)   For the self-employed: pay £10,000 now (instead of tax), reduce payments on account and gain the £10,000 back in 6 years.

The net result in any case is a total return of 200% investment over the 6 years. That's 100% profit in 6 years' time even if the film loses 50% of investment.

The expectations are that the sales returns will be higher. Once the sales returns hit 125% of the cost of production, the investor returns look very interesting.

Films and actors are high profile and investors are kept well informed of activity

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Not all areas of film investment are regulated by the Financial Services Authority. The Financial Services Authority does not regulate tax advice