Tax fraudster jailed after HMRC discovers hidden business activities

A garage owner who attempted to avoid paying tax by hiding his business activities from HM Revenue & Customs (HMRC) has been found guilty of tax fraud.

Carl Hutchinson, 61, from Manchester, was sentenced to 27 months in jail after a HMRC tax investigation discovered that he had traded for five years as DPC, Fine Motors and Fine Garages but during this time had failed to submit any tax or VAT returns.

HMRC’s tax investigation team found that Hutchinson had avoided a £118,000 tax bill by faking invoices and falsely using the VAT numbers of other legitimate companies on his customer invoices.

He charged VAT on his garage services but, despite being registered with HMRC, he did not declare any of his income and pocketed the VAT rather than paying the tax he owed.

During the five years he was committing tax fraud, he traded with several companies and during their investigation, HMRC collected statements from his customers and suppliers which provided further evidence that he had been using bogus VAT information on his invoices.

Following a hearing at Manchester Crown Court, Hutchinson was sentenced to 27 months in jail for tax evasion and associated money laundering. HMRC will now begin action to recover the stolen tax.

Dr Anjulika Salhan, a director and tax investigation specialist with Salhan Accountants commented: “HMRC has wide reaching criminal investigation powers and takes a particularly dim view of bogus VAT registration fraud.

“Whilst there are some individuals who intentionally plot to commit tax fraud, equally many business owners unwittingly fall foul of HMRC’s rules and find themselves under the spotlight of an investigation.

“If expert tax investigation advice is not sought urgently a hefty fine or – worse still – prosecution through the criminal courts could result.

“We have represented a number of individuals who, for a variety of reasons, have found themselves in breach of HMRC regulations. As with all HMRC matters, tax investigations need to be dealt with as a matter of urgency.”

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.