HMRC penalties, Convictions & sentences - May 2022

Overview:

A fish seller, buy-to-let landlords and a crypto investor, not to mention an accountant and bookkeeper, all failed to pay their taxes and face millions of pounds in penalties

HMRC has issued penalties for unpaid tax totalling £12.5m in an effort to force the tax evaders to settle their bills. This compared to penalties of £18.4m for the last quarter. Here is a rundown of some of the more substantial examples of tax evasion and the lengths HMRC is going to in a bid to recover the millions in evaded tax.

Buy-to-let landlord and crypto investor who racked up a staggering £4.04m in unpaid tax and now has been hammered with a £2.82m fine.

Buy-to-let property owner avoided paying £152,819 and faces a penalty of over £80,000

Labourer spent three years avoiding paying tax, with an outstanding bill of £738,687, which never crossed HMRC’s radar until a fine of £517,000 was issued.

Waste management company racked up a tax bill of £1.45m over a 14-month period. The business now faces a penalty of nearly £740,000.

Fish supplier which owed a significant £940,932 in unpaid tax. Once a penalty of £458,000 is added to the bill the fisher will be facing a bill of nearly £1.5m. When the company went bust a director’s loan account of over £1.9m was outstanding and £320,000 in PAYE due to HMRC.

Sussex based takeaway owing £261,000 with a severe penalty of £151,000 for failure to pay taxes.

A fish and chip shop owner racked up a tax bill of £95,000 now has to settle a £52,600 penalty for failure to pay taxes due.

A Chinese restaurant owner underpaid taxes to the tune of £129,000 and now faces a substantial penalty of £85,500

An accountant and business investment consultant failed to comply with his tax liabilities with an £128,137 bill outstanding, augmented by a £76,500 penalty.

Bookkeeper also understated earnings over a six-year period with £67,000 of unpaid tax resulting in a £35,000 fine.

A dog breeder under-declared earnings, resulting in a tax liability of £28,500, which resulted in a fine of over £15,000 for non-compliance.

HGV driver evading millions in tax with £2.9m identified by HMRC. Unsurprisingly, a penalty of £1.7m has been issued.

Limited company which had two members of staff, was involved in ‘supply of face masks’ evaded £374,658 in tax and has been given a significant fine of £262,000 for evasion.

Directors banned over £8.9m hotel room investment scheme

• The company bought and refurbished Hotel, before offering people the opportunity to invest in hotel rooms.
• The directors leased approximately 82 rooms to investors for approximately £8.9m
• Company went into insolvency with creditors, claiming more than £14.8m in the liquidation.

Takeaway boss banned over £50k covid loan abuse

• Director has been disqualified for seven years after wrongly claiming £30,000 through the Eat Out to Help Out scheme and over £20,000 through the Coronavirus Job Retention Scheme.
• Director failed in his obligations as director to maintain adequate accounts and financial records.

Umbrella payroll company director banned over £4.1m tax bill

• Company provided umbrella payroll services and outsourced its operations to a network of Isle of Man companies.
• The company website advised contractors that, based on an income of £100,000, they could retain £90,000, compared to £75,000 if they declared earnings through a limited company.

Consultancy director banned over £30k covid loan

• Director applied for a £30,000 bounce back loan despite the company accounts showing annual turnover of around £50,000.
• The maximum the company was eligible to claim £13,000.
• The director ban lasts for eight years.