Two generations of the same family were handed jail sentences after they were found guilty of tax fraud.
Bernard and Maureen Knutsen, along with their daughter Kelly Ann, were subjected to a taxation investigation when their family businesses attracted the attention of HM Revenue & Customs’ (HMRC) inspectors.
The Knutsen family ran both Chaplin’s Bar and a car repair garage in Liverpool but it was discovered that they had failed to pay any VAT, National Insurance or Income Tax whist at the same time fraudulently claiming benefits.
HMRC’s taxation investigators uncovered the £470,000 fraud and arrested Maureen Knutsen at Manchester Airport as she arrived back in the UK from a holiday in Las Vegas.
All three members of the family were prosecuted, along with a family friend and other individuals who were discovered by both HMRC and the Department for Work and Pensions (DWP) to have also committed fraud whilst working for the Knutsens.
Both Bernard and Margaret Knutsen will be spending Christmas in prison, having been handed jail sentences of four years and three years respectively. Their daughter, Kelly Ann, managed to avoid custody, as her 21-month jail sentence was suspended for two years.
Speaking after sentencing, Sandra Smith, Assistant Director, of HMRC’s Fraud Investigation Service said: “This family thought they were exempt from the law. You cannot decide to ignore your tax obligations and not expect HMRC to take action. We are determined to maintain a level playing field for all local businesses and will not tolerate fraud like this.”
Dr Anjulika Salhan, a director and tax investigation specialist with Salhan Accountants commented: “If fraud is suspected, taxation investigators have wide ranging powers and will often work with other agencies such as the DWP to build a picture of an individual’s financial history, highlighting any anomalies such as fraudulent claims and a failure to declare earnings.
“In such circumstances, where a person has deliberately set out to commit tax fraud, HMRC will not hesitate to prosecute.
“Although only a minority of individuals intentionally set out to defraud HMRC, there are many people who find that they have unwittingly broken HMRC’s tax rules and are shocked to discover that they are under the spotlight of a tax investigation.
“At Salhan Accountants, we work extremely hard for clients subjected to a taxation investigation. We not only clarify the issues and the process, but come up with solutions too.
Our experience, professional reputation, forensic attention to detail and negotiating skills mean we are well-placed to achieve positive outcomes.”
For more information about our taxation investigation services, please contact us.