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Pop star Melua was clueless about aggressive tax avoidance scheme

CHART star Katie Melua has told how she was clueless and inexperienced when she followed the advice of experts to sign up to what turned out to be an aggressive tax avoidance scheme.

The singer was among around 1,600 people who were involved with the controversial Liberty tax strategy, but she went on to settle her tax in full with HM Revenue and Customs.

Opening up about the furore for the first time, she admitted it "sucks" that she has been under the spotlight for her part in it, and called for such schemes to be stopped to prevent others from being advised by experts to take part.

Closest Thing To Crazy singer Melua was on a list of figures - including celebrities, doctors and judges - given to a newspaper after they put around £1.2 billion into the scheme from 2005 until 2009. The arrangement created a tax loss for investors which they could offset against other income.

Other celebrities have not responded to the claims they were involved, but Melua told how she pulled out as soon as she was made aware of the nature of the scheme and paid her tax liability.

Writing about the issue on her website, she explained: "At 19 I was lucky enough to start making money from my music career, and when I was in my early twenties I trusted financial experts and advisors to guide me. That I was fairly clueless and inexperienced when it came to finance goes without saying and, I'm embarrassed to admit, not as interested in it as I should have been. My focus was totally on making music and performing live.

"From what I can remember in 2008 when the Liberty scheme was presented to me it was not presented as an aggressive tax avoidance scheme.

"It was presented as an investment scheme that had the potential to legally reduce yearly income tax. My advisors would take care to complete the formalities which included dealing with HMRC."

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