A man convicted of evading £1.3m VAT was jailed for three and a half years at Oxford Crown Court last week.
The court heard that between October 2001 and July 2006 Philip Bowles, 60, of Maidenhead, failed to submit VAT returns related to the sale of land for commercial development in Cardiff worth £7.5 million.
Following an investigation by HM Revenue & Customs, Bowles was charged on three counts of ‘Cheating the Revenue’. He failed to account for the VAT received as ‘output tax’ in respect of two companies he controlled – Sea Island Holdings Ltd and Ocean Developments Ltd based in West Drayton, Middlesex. Having failed to account for this output tax, he then failed to pay the VAT which was due.
Note: VAT registration means you must charge VAT on the selling price of goods and services that are liable to VAT. This VAT is known as ‘output tax’ and must be paid to HM Revenue & Customs. If you are registered for VAT you are able to reclaim back the VAT you pay on your business purchases. This is known as ‘input tax’. You claim this back on your VAT return.
Bowles’s was found guilty on all three counts of cheating the Revenue at Reading Crown Court on 1 June 2009. He has also been disqualified from being a company director for six years.
In passing sentence, Judge King said:
“I am satisfied that the fraud was not committed in order for you to line your own pockets but to keep your aircraft industry business afloat.
“You knew the financial difficulties and you equally knew the money was not yours and was that of the tax authorities. You made excuse after excuse, blaming others at every stage and deliberately misleading every department of HM Revenue & Customs.
“I consider this a very serious cheat and a substantial custodial sentence is appropriate.”
Confiscation proceedings are in place to recover the proceeds of the crime for the benefit of the public purse. Philip Bowles has, however, appealed against the conviction.
HM Revenue & Customs Criminal Investigations Assistant Director Peter Avery said:
“Tax evasion is serious, blatant theft and we will continue to pursue those trading fraudulently to the full extent of the law. This three-and-a-half-year sentence will serve as a deterrent to anyone who thinks that tax fraud is a risk worth taking.”
** Additional Information & Advice **
Are you in tax trouble? Depending on your circumstances, you may want to speak with a solicitor who specialises in tax law.
You can be matched with a solicitor for free via solicitor matching services, which can also help you to understand the best course of action for your situation and whether you are ready to hire a solicitor.
- VAT Rate Will Return To 17.5% From January 1, 2010 (FindLaw – August 25, 2009)
- VAT Returns: Businesses Prepare For Major Filing Changes In 2010 (FindLaw – December 3, 2009)
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