UK’s wealthiest financier Michael Platt’s hedge fund in high-stakes tax fight
Hedge funder BlueCrest Capital Management, founded by the UK’s wealthiest financier, Michael Platt, will appeal at the highest court this week over a tax battle with HMRC.
The case centres on the salaried members’ rules, which determine if limited liability partnerships (LLP) members are genuinely self-employed or ‘disguised employees’ for tax purposes.
HMRC issued determinations for the tax years 2014/15 to 2018/19, arguing that nearly all BlueCrest members, bar a few executive committee members, were ‘salaried members’, and as a result, it sought to collect income tax and national insurance contributions.
The amount of tax at stake for BlueCrest if it loses at court is nearly £200m.
Platt, who resided in the United Arab Emirates (UAE), was at the helm of the group throughout the tax years in the dispute. In 2023, the Sunday Times Rich List estimated his net worth at £11.5bn.
The hedge fund giant sought an appeal against HMRC’s decision, which has seen this case working its way through the court system over recent years.
BlueCrest Capital Management reported a significant revenue surge to £130.8m for the year ending 31 March 2025, a 149 per cent increase from £52.6m the previous year.
In-and-out of court
The case first went to the First-Tier Tribunal, which was heard before Judge Andrew Popplewell in March 2021, who handed down a split decision.
The FTT ruled against BlueCrest, finding that discretionary bonuses based on individual performance constituted “disguised salary. However, it also partially ruled in favour of the hedge fund, finding that its portfolio managers had “significant influence” over the firm due to the sheer financial impact of their roles, even if they weren’t in senior management.
Both parties appealed to the Upper Tribunal, which held a hearing in June 2023, and this court largely upheld the FTT’s decision.
Both parties again applied to the next court up, the Court of Appeal, which heard the case in November 2024, and the judges delivered a blow to BlueCrest. The court also set aside the hedge fund’s prior wins and ordered the case returned to the FTT for rehearing under the new, stricter legal test.
BlueCrest Capital applied to the Supreme Court, which HMRC objected to, but permission was granted. The Alternative Investment Management Association (AIMA) and Managed Funds Association were granted permission to intervene in the case.
The case now goes to the UK Supreme Court, the highest court to which it can appeal. The Lord Justices will be expected to answer ‘are certain members of BlueCrest LLP to be treated as employees for tax purposes?’, following a two-day hearing starting on Wednesday.