Inverclyde Council used controversial tax avoidance scheme to finance office upgrade

A second Scottish council used a controversial tax avoidance scheme to finance an office upgrade, The Mail on Sunday can reveal.

Inverclyde Council struck a deal with investors including Olympic rowing champion Sir Steve Redgrave to save it cash on the development.

The move saved Inverclyde £1million, but may have cost taxpayers £1.5million in lost income tax receipts.

The case comes after The Mail on Sunday revealed that Clackmannanshire Council had financed a tax avoidance scheme which may have cost the taxman £3.6million.

The arrangements for both councils were structured by specialist tax planning firm Chancery.

The arrangements exploit the Business Premises Renovation Allowance, a tax break covering upgrades to buildings.

Investors get short-term ownership of the buildings plus a loan from the council. They renovate the buildings and deduct the full cost from their personal tax bills.

Sir Steve Redgrave declined to comment.