Court News: a snapshot of recent cases

Inland Revenue collects more than $70 billion in revenue each year – money which goes towards our hospitals, schools and society in general.

When taxpayers evade tax and don’t file returns, neglect to pay workers KiwiSaver contributions or do cash jobs they’re stealing from all Kiwis.

We rely on trust and honesty of taxpayers but when people aren’t upfront and try to cheat the system, Inland Revenue regularly prosecutes taxpayers who don’t pay their fair share. Here are sentences handed down in recent months.

Commissioner of Inland Revenue v Maria Kinloch

A now bankrupt exercise trainer has been sentenced to just over six months home detention after claiming more than $61,000 in tax refunds that she wasn’t entitled to.

Maria Kinloch was sentenced in the Marton District Court on March 27. As well as home detention Kinloch also has 10 months standard post detention conditions.

Kinloch admitted she had intentionally filed false GST returns to obtain refunds that she knew she was not entitled to. Total refunds obtained $61,465.22.

Commissioner of Inland Revenue v Ranjit Singh

Kiwifruit contractor Ranjit Singh has been sentenced to 6 months home detention and 100 hours community work on 25 tax evasion charges.

Singh is involved in the operation and management of Sursingh Enterprises and Sursingh Horticulture and supplies seasonal workers for kiwifruit orchards in the Bay of Plenty.

Singh either filed tax returns and then didn’t pay the resulting tax bill or failed to file the tax returns for the companies. He owed $118,365.16 in core tax.

Commissioner of Inland Revenue v Carla Pearce

Invercargill courier driver Carla Pearce has been sentenced to 6 months community detention with an overnight curfew on 27 charges of tax evasion.

Pearce has also been sentenced to 100 hours community work, 12 months supervision and full reparation of the $57,000 debt at $3,000 per month.

Carla Pearce didn’t file GST between October 2012 and June 2016 despite numerous letters and massages about the outstanding amount. She also failed to file income tax returns for the 2017 and 2018 tax years. Pearce was sentenced in the Christchurch District Court on March 19.

Commissioner of Inland Revenue v Christopher Allan Mankin

An Auckland builder has been fined nearly $7,000 for failing to provide tax returns over a four-year period.

Christopher Allan Mankin was sentenced in the Waitakere District Court on March 15 on 30 counts of failing to furnish GST returns and 4 of failing to furnish income tax returns.

He was sent blank returns to complete; sent a reminder notice when the returns first became overdue; and advised that legal action would be taken. Public notices about due dates were also placed in national and local newspapers, and on tv and radio.

Commissioner of Inland Revenue v Michael Warren Stevenson

A former Christchurch man who filed fake tax returns for a panel-beating business which never operated has been sent to jail for 22 months.

Michael Warren Stevenson tried to claim $173,497.95 in GST refunds for his business No Limits Customs Limited. But the company had no customers and no income for nearly two years.

He was charged with 11 counts of using documents (his GST returns) to gain pecuniary advantage. Stevenson was also ordered to pay reparations of $25,000 starting 3 months after his release from prison.

Commissioner of Inland Revenue v Ross John Allan

A Queenstown business consultant has been sentenced to 120 hours community work for failing to fill out GST and income tax returns.

Ross John Allan was sentenced on February 11 in the Queenstown District Court on 42 charges. Allan didn’t file between March 2012 and 31 March 2016 despite regular reminder notices and contact from IRD staff.

He failed to communicate or co-operate with Inland revenue; failed to comply with his tax obligations and file his returns; and failed to make any tax payments towards his potential tax liability.

Commissioner of Inland Revenue v Bhim Sen

A Hamilton sweets and takeaway retailer has been fined $3,000 after his business failed to provide GST and PAYE returns between September 2016 and April last year.

BSC Indian Sweets and Takeaway Ltd was set up in 2015 and was sent blank returns forms for completion.  Reminder notices were automatically sent as each return became overdue and a final notice letter was sent in November 2017.

Sen entered a guilty plea when he appeared in court last year.  He was sentenced in the Hamilton District Court on January 25.

Commissioner of Inland Revenue v Te Waikomo Jacqueline Edmonds

A former Whanganui shearing gang owner has been sentenced to 7 months home detention and 120 hours community work on tax evasion charges.

Te Waikomo Jacqueline Edmonds, along with her husband, ran a shearing business known as Edmonds Shearing or Sean Edmonds Ltd.

No PAYE returns were filed from September 2009 to February 2014.  Based on payslips, cheque butts and bank statements IR assessed $186,536 was undeclared and unpaid. Mr Edmonds is charged with aiding and abetting his wife and is due to be sentenced in April.

Commissioner of Inland Revenue v Kim Loong Tan

Auckland builder and landscaper Kim Loong Tan has been sentenced to seven months home detention on tax evasion charges.

In February 2014, Inland Revenue conducted a review and audit into his tax affairs and those of his company Elite Construction. He was sentenced in the Waitakere District Court on November 1, 2018.

Kin Loong Tan filed false tax returns, wasn’t assessed for and didn’t pay the tax he was liable for.  He also didn’t register for GST and didn’t file any returns so wasn’t assessed for and didn’t pay the GST amount he owed. His debt was more than $700,000.

Commissioner of Inland Revenue V Clinton Kingi

A Hutt Valley man was sentenced to 4 months community detention in the Wellington District Court after filing false GST returns.

Clinton Kingi claimed he was the sole director and shareholder of Motormovers Limited but Inland Revenue said Kingi never ran any business and the GST returns filed were fictitious.

Documents showed all bank transactions were related to personal spending or online transfers into Kingi’s personal online gambling accounts. He was sentenced on November 2, 2018.

Commissioner of Inland Revenue V Richard Ernest Neill

A Rangiora company director was sentenced to 6 months home detention on 11 charges of tax evasion, totalling just over $275,000.

Richard Ernest Neill ran Bullock Construction Limited which did residential and commercial construction work.

The Company failed to pay PAYE, KiwiSaver deductions, KiwiSaver employer contributions, student loan deductions and superannuation cash contributions. Neill paid creditors of the company instead of paying its PAYE obligations.

Commissioner of Inland Revenue V Samantha Taylor-Halliday

Samantha Taylor-Halliday was sentenced to 3 months’ community detention on theft charges.

Taylor-Halliday filed several false tax returns and $10,000 was paid in to her account. Ms Taylor-Halliday was contacted in relation to the refund and advised not to spend the money because it was issued in error.

However, $1,695.04was spent at major retailers and $2,500 was withdrawn. An account halt was placed on the remaining money and couldn’t be withdrawn.

Commissioner of Inland Revenue V Rajen Singh

Self-employed house painter Rajen Singh was sentenced to 3 months home detention when he appeared in the Manukau District court for tax evasion of $44,665.

From November 2010 until September 2015 he sent invoices and charged GST. He was paid for the work, including the GST amount, but at no time filed GST returns for the 2011 to 2014 income years.

Inland Revenue told the court Singh’s actions were intentional and premeditated.

Commissioner of Inland Revenue V Chamrouen Sorm

Former bakery owner Chamrouen SORM has been sentenced in the Waitakere District Court to ten months home detention for failing to include more than $840,000 in cash sales from her GST and income tax returns over eight years.

Significant cash sales weren’t banked into the business bank account. Her cash sales were over 50% of her daily sales for her business.

Over an 8-year period between 2005 and 2013 Sorm suppressed cash totalling $842,923.51 which she used to finance her lifestyle and acquire assets. The amount of tax evaded was just over $336,000 but Sorm repaid $316,000 prior to sentencing last November.

Commissioner of Inland Revenue V David Peter Verschaffelt

Company director David Peter Verschaffelt was sentenced to ten months imprisonment for failing to pay $379,350.60 in PAYE to Inland Revenue. The term was added to time already serving on unrelated charges.

Verschaffelt was a director of Atmospheric Ltd from April 2010 and became its sole director in May 2016.

Between October 2015 and July 2016 didn’t pay the deductions it declared to Inland Revenue. Instead Verschaffelt paid it to other creditors so the business could continue to operate.

Commissioner of Inland Revenue V Hamiora Tamnauitera Wanoa

A builder has been sentenced to seven months home detention for not providing GST and income tax returns for his business, and personal income tax, for more than four years.

Hamiora Tamnauitera Wanoa was sentenced in the Hutt Valley District Court on November 23.  As well as the home detention, he was ordered to complete 200 hours community work and ordered to pay $4,000 in reparation.

Wanoa ran East Coast Reofix and Formwork Limited and between 2012 and 2017 evaded $73,622 in GST and core tax of $83,857. He also evaded paying $102,419 in personal income tax.

Commissioner of Inland Revenue V Andrew Hui Chiu

The operator of a Yum Cha restaurant in Lower Hutt was sentenced to three months home detention and a $6,000 fine for tax evasion totalling $45,400.

Andrew Hui Chiu ran the restaurant with his wife and another man where he managed the accounts, daily takings and purchased stock. An audit showed that over 3 to 4 years $170,787.24 in cash sales was not declared.

The money was used to purchase stock from markets and to pay a chef in cash. The court heard Chiu and two co-defendants maintained a practice of underreporting cash sales and paying employees undeclared wages for several years.

Commissioner of Inland Revenue v Anthony Aubrey James Morris

Self-employed Bay of Plenty man, Anthony Aubrey James Morris, has been sentenced to nine months home detention and 250 hours community work on tax evasion charges.

Morris failed to register for GST, didn’t file GST returns or income tax returns and pay any tax between 1 April 2009 to 31 March 2016.

The amount of tax evaded was around $90,000. At trial, he denied he knew he had obligations to file returns or pay tax but other witnesses including former partners gave evidence Morris knew he had tax obligations and that he knew they were not being fulfilled.

Commissioner of Inland Revenue V Darren James Mills

Chartered accountant Darren James Mills has been fined $4,000 for knowingly not providing information to the Commissioner.

Darren Mills was the sole director of Mills Consulting Limited. The company, acting has his tax agent, filed late returns for seven tax years and from 2009 to 2013 claimed expenses.

The Commissioner asked for documents to support the expenses, most of which he didn’t provide. Mills was sentenced on December 12.

From the IRD News website | © Copyright 2020 Inland Revenue.