The Harry Potter actor Rupert Grint has been ordered to pay £1.8m in taxes after a legal dispute with HM Revenue and Customs (HMRC).
Grint, best known for playing Ron Weasley in the film franchise, was told to pay the figure in 2019 when HMRC questioned one of his tax returns.
HMRC disputed £4.5m in income he received during the 2011-12 tax year, claiming it should have been taxed as regular income rather than as a capital asset.
The 36-year-old actor, who was the sole shareholder of a company managing his business affairs, claimed the payment was related to residual income and bonuses from the Potter films.
Grint’s lawyers argued he should only have to pay capital gains tax, which would have been at a rate of 10%. However, HMRC said the money should be taxed as income, subject to a higher tax rate of 52%.
Judge Harriet Morgan ruled in favour of HMRC, dismissing Grint’s appeal, and said the money “derived substantially the whole of its value from the activities of Mr Grint”, which was “otherwise realised” as income.
It is not the first time the actor’s tax affairs have been subject to court proceedings. Grint also lost a separate court case in 2016 involving a £1m tax refund.
A tax tribunal judge rejected the actor’s appeal against an HMRC block on him using a change in accounting dates to shield his earnings from the higher 50% tax rate. The actor was calculated to have earned about £24m from the Potter franchise.
Judge Barbara Mosedale described how Grint had followed advice from tax advisers Clay & Associates to change his accounting date so that 20 months of income would be taxed in 2009-10.
The judge said Grint wished to bring forward to the earlier year liability for payments on eight months’ worth of income otherwise due in the tax year 2010-11 – the year the top rate of tax rose from 40% to 50%.
Mosedale said if the date change had been accepted it would have led to a 10% saving on income – about £1m, according to Grint’s accountants.
Grint appeared in all eight of the Harry Potter films between 2001 and 2011, and has since appeared in the films Into the White and Knock at the Cabin, as well as working in TV and theatre.
Grint has been approached for comment.
