Times tax investigation brings more UK interest

THE UK is gearing up for a new clampdown on Channel Islands tax avoidance schemes after an undercover investigation by The Times.

The national newspaper's front page revealed yesterday that comedy star Jimmy Carr was one of 1,100 UK residents who paid as little as 1% in income tax because of a Jersey-based scheme.

K2 allegedly shelters £168m. from the UK taxman every year by transferring salaries into a Jersey-based trust, which lends investors the money back tax-free.

It works because the loans are technically repayable, but the people running it told an undercover Times reporter 'no one has ever been in a position where they have had to repay'.

After the story broke, HM Revenue and Customs said it was investigating whether the scheme was technically legal.