Keeping your tax affairs in order is essential. It may sound obvious and it may sometimes feel a little painful having to pay the taxman, but not doing so can lead to you facing consequences beyond any penalties you may incur.
For example, last week the director of a small pub company was banned from running or being involved in the running of a company for 11 years after his business went into administration in November last year.
It’s sad when a company fails, and when it does, the Insolvency Service gets involved to investigate what went wrong.
In this case, they looked at the business – which owned 11 pubs in the Derbyshire and Nottinghamshire areas – and how it had gone bust owing creditors almost £6.9million.
It was then that the tax affairs of the director came to light.
It discovered that in March 2015 the director, Kirpal Rathaur, had falsely removed the company, Edward & Moore, from the business tax list.
They then found that the company had run up liabilities of almost £8million and that the director had failed to maintain or preserve accounting records for the company.
This meant it was impossible to establish what happened to the £7.9 million in unpaid taxes, how much in total was owed to the company’s creditors, including the tax authorities, as well as establishing how much money the director withdrew from the company.
Martin Gitner, Deputy Head of Investigations, of the Insolvency Service said: “Directors cannot pick and choose what taxes they want to pay but this did not deter Kirpal Rathaur from avoiding paying business duty that he rightfully owed. An 11-year disqualification is a substantial ban.”
No one will ever know exactly what happened to the money, but destroying records, or not keeping them, isn’t a way of avoiding justice.

Guidon Group Ltd

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