Officials and liquidators are pursuing companies behind 21 films that applied for almost £16 million in incentives from a joint scheme run by HMRC and the British Film Institute.
Companies controlled by prolific film producer Alan Latham – whose films have starred stars such as Elizabeth Hurley, Kelsey Grammer and Bill Nighy – are being investigated by HM Revenue & Customs (HMRC) as questions are raised about how taxpayers’ money was used to finance dozens of little-known productions.
Liquidators are investigating the collapse of Highfield Grange Production Services, one of Latham’s key holding companies, whose £20.4m film investment has now been written down to zero. Creditors, including HMRC, faced losses after Highfield went into liquidation following a tax dispute.
The tax authority is also seeking to break up GSP Studios International, the majority shareholder in Highfield and another company controlled by Latham.
A Times investigation found that more than 20 films linked to Latham tried to claim £16 million in creative industry tax relief, part of a government scheme run jointly by HMRC and the British Film Institute (BFI) to boost British film production.
Titles include “Christmas in Paradise,” a romantic comedy starring Elizabeth Hurley (pictured) and Kelsey Grammer, filmed in the Caribbean as part of a St. Kitts and Nevis promotional deal, and “Miss Willoughby and the Haunted Bookshop,” again starring Grammer.
Many of the companies behind these films have not filed accounts for several years – a criminal offense – while others face removal from the corporate register. The films are missing from the BFI’s list of projects that received final certification, but some received “interim certification,” which allows funds to be released before completion.
Questions have also been raised about the accuracy of production budgets used to claim tax breaks.
Solis, for example – a 2018 sci-fi film starring The Walking Dead’s Steven Ogg – is reported to have cost £4.7m in the company’s accounts, which is eligible for an interim tax credit of almost £1m. Its director Carl Strathie has publicly stated that the film’s actual budget was closer to £700,000.
Another film, Gatecrash (2020), was reported to have cost £4.5 million, but people familiar with the project claim the budget was around £750,000. It received almost £900,000 in tax credits.
Begbies Traynor liquidators, who are overseeing the administration of Highfield, said they had carried out “thorough investigations” into why the film investment was written off. In this year’s filings, they confirmed that lawyers had been instructed to pursue “related parties” with “significant claims” against two unnamed special purpose entities.
They added that “significant amounts of money were paid to other related companies” and that transactions were being investigated because they “resulted in a reduction in the company’s assets.”
A statement signed by Latham listed £3.7 million owed to GSP Studios International, another of his companies, which is also now facing a lawsuit from HMRC.
The episode has raised wider questions for HMRC and the BFI, which oversee the certification and administration of Britain’s £500m-a-year film tax credit scheme.
The BFI confirmed it was working closely with HMRC and the government to “maintain the integrity of the system”, adding: “We take any concerns about possible abuse seriously. The tax incentives have helped attract investment, create jobs across the UK and showcase British creativity around the world.”
An HMRC spokesman simply said: “We take compliance with tax relief for the creative industries seriously.”
Latham, an accountant turned film producer, has held more than 150 directorships and remains associated with more than 60 active companies. He did not respond to multiple requests for comment.
There is no evidence of misconduct by any actors or crew members involved in the productions.
In 2022, Latham told the Mail on Sunday that “inefficiency” was to blame for his companies’ repeated failure to report accounts after investors complained about money losses in one of his previous films, The Comedian’s Guide to Survival, which grossed just £75.
