The Eclipse Film Partners (numbers 1 to 40) Limited Liability Partnerships (Eclipse LLPs) were complex financial arrangements. They aimed to generate large interest payments on bank borrowings, presented as contributions to the capital of the Eclipse LLPs, so they could buy film rights.

The Eclipse members claimed relief for the interest payments against their income to avoid tax. Each Eclipse LLP entered into substantively identical arrangements.

Following a court ruling, HMRC has confirmed that in its view investors are not entitled to Eclipse interest relief and has accepted that the estimated tax bill of £1.6bn was non recoverable.

HMRC will contact an estimated 700 investors with a settlement opportunity to resolve any Eclipse related tax issues. The settlement opportunity will be open for acceptance for six months from the date taxpayers are notified of the option to settle.