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Thursday, 18 June 2015

Owner of children's nursery chain jailed for £1m tax fraud

Written by The Press Association

The owner of a chain of children's nurseries who stole £950,000 from his employees - through money deducted from their salaries as tax and National Insurance - has been jailed for five and a half years.

Michael Scott, 63, of Grovebury, Locks Heath, cheated more than 180 employees by deducting Pay As You Earn (PAYE) Income Tax and National Insurance Contributions (NICs) from the salaries of his workers, but then failed to declare and pay the money to HM Revenue and Customs (HMRC).

He also failed to declare and pay employer National Insurance.

The HMRC launched an investigation after former employees at the Pixies chain of nurseries raised concerns about gaps in their income tax and national insurance records.

The investigation revealed that he had been stealing from his employees for more than four and a half years, between April 2007 and November 2011.

John Cooper, HMRC's assistant director of criminal Investigation, said: "Michael Scott brazenly robbed his employees and lined his own pockets at the expense of the wider taxpaying public.

"Tax was deducted and shown on payslips but the money was not handed over to HMRC, leading to gaps in employees' tax records."

Scott (pictured), who owns a vast property portfolio and a private aircraft, pleaded not guilty at Southampton Crown Court on November 12 2013 and was found guilty by a jury. He was sentenced in relation to a £800,000 net figure, a HMRC spokeswoman said.

Sentencing him, Judge Peter Henry said: "You were involved in fraud on a large scale for a number of years. As an employer it was your job to deduct taxes from your staff and to provide them to the Revenue.

"Fraud against the Revenue goes to the heart of society, but millions pay their taxes year in year out. This is a cheat of your fellow citizens, but the group you put at substantial risk is your staff. Your actions put in jeopardy their rights and entitlements."

An HMRC spokeswoman said that confiscation would now be sought to recover the proceeds of his crimes.

Copyright (c) Press Association Ltd. 2015, All Rights Reserved. Picture (c) HM Revenue & Customs/PA Wire.