Actor and "Harry Potter" film franchise star Rupert Grint has lost his appeal to HM Revenue & Customs in the United Kingdom in a case involving income he claimed was being improperly taxed at a much higher rate. The legal battle stemmed from the income he received in the 2011-2012 fiscal year, with HMRC disputing his return in 2019 and claiming the income should have been taxed as regular income rather than a capital asset at a much lower rate.
The income in question is some $4.8 million US Grint received from a company he himself owned, reported to be "likely residual income and bonuses" from his role in the continually popular "Harry Potter" feature films, which came out between 2001 and 2011 and still generate significant royalties today. He initially paid a capital gains tax rate of 10 percent on the income, leading HMRC to dispute his tax return several years later, saying it should have been taxed as income at the highest marginal rate of 52 percent.
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Grint went to court to dispute the HMRC claim, but now he's lost and is on the hook for some $1.9 million US.
In rejecting Grint's appeal, the presiding tax tribunal judge said the income "derived substantially the whole of its value from the activities of Mr Grint," making it regular income rather than a capital gain.
It's actually the second piece of bad news Grint has gotten in the UK tax court over the last several years. In 2019, he lost a case that centered around a wrongful tax refund of over $1 million US, which he subsequently had to pay back. Fortunately, he has also been working steadily in that time frame, appearing in the M. Night Shyamalan film "Knock at the Cabin" and the Apple TV series "Servant" which has been airing since 2020.
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