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Landlord jailed over capital gains tax bill

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A Hampshire landlord who evaded £158,000 of capital gains tax from the sale of properties has been jailed for two years and three months.

An investigation by HM Revenue & Customs (HMRC) revealed that between 2006 and 2013, Richard Fuller didn’t declare profit gained from selling properties in the Aldershot area.

[.....]“HMRC will continue to pursue those who attempt to hide their gains on assets, their income, and investigate those who attack the tax system.”

Fuller was arrested at Gatwick Airport in October 2014 after a holiday to Turkey.  He was found guilty of two counts of cheating the public revenue and three counts of fraud by false representation on 14 July 2017, and was jailed for two years and three months at Winchester Crown Court on 11 August 2017.

Sentencing Fuller, Judge A J Barnett, said: “The jury found you guilty of dishonesty.

“This is a serious matter, you deliberately failed to pay your capital gains tax over several years.”

HMRC will seek confiscation to recover the proceeds of Fuller’s crimes.

 

If evaded £158K in capital gains tax from his landlording sale of properties, then seem around right.. 2 years and 3 months in nick + HMRC to go in to try and recover the tax and their costs from his other assets.

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A HPCer:  I am not suggesting they let them out to carry on evading. But I assume a prosecution is likely to cause them to lose whatever job they are doing and possibly fall back on the state for benefits and if they get a custodial, there is the cost of having them sit in prison, followed by benefits again. So they get the one off shot of cash, but over the long term this could be self defeating (unless the cash they get is significant). Better they go back to their job and lives and continue to pay into the system (unlikely to evade again). Esp if we are taking about 1m taxpayers. Plus those setting the rules don't want to 'accidently' fall foul and get stung themselves.

[...]So you hit them hard with penalties and claw back the tax, but let them fly free again to continue to be productive members of society (rather than unemployable criminals). Just cherry pick a few big offenders and a random sample of others and prosecute them - to get the message and fear out. I think this is pretty much what your quotes say.

 

Nah get as many as possible when they evade over £5K... and especially larger sums... £10K+.

I don't see anything good in allowing dishonesty to get away with it... (the Let campaign run for years... CGT well known about... accountants)  for BTLers to keep their 'productive members of society' / 'other good incomes' (many BTLers also good incomes over the years).   In to gaol they should go for serious evasion.   Get the tax owed back + apply £ penalties too.   Honest people can be promoted/take their employment positions.

 

On 15/08/2017 at 7:54 AM, Venger said:

Those BTLers prosecuted also create jobs (in a way) by allowing other people - honest people - to take their positions.  So sad, too bad... BTLers... owners/claims on multiple homes in a supply and affordability crisis for the young.  

It might not be BTLers on to benefits... just less of the Range Rover lifestyle and having to downsize to a terrace, from life of mansion and 5+ BTLs.  Too bad.   And benefits are not going to be all so easy to claim... sign-on.  Whatever costs are, they will be worth it.... to get the tax-evading/societally destructive BTLers out of the way.

BTLers as 'productive members of society'..... :mellow:

 

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13 minutes ago, The Preacherman said:

Does the conveyancer have a duty to alert HMRC to a property sale for any potential CGT?

It's all computerised these days.

HMRC came after me once for £120 quid of missed bank interest !!!

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59 minutes ago, TheCountOfNowhere said:

A feel good story to start the day

 

https://www.ftadviser.com/regulation/2017/08/14/landlord-jailed-over-capital-gains-tax-bill/

 

A Hampshire landlord who evaded £158,000 of capital gains tax from the sale of properties has been jailed for two years and three months.

 

:ph34r:

Good find,

Just hope this article proves HMRC are on the case rather than trying to give the impression they are on the case as a warning for BTL's exiting not to be naughty boys. Goodness knows how they will ever catch that one certain ethnic  group I know of who work in massive networks between each other and create a  complex paper trail, hope they are trying.

Another favourite saying I have been hearing for years from BTL scum when I ask them what if it all goes t**s up, their answer is so often I will let the lenders whistle for their money and go bankrupt. After our banking system in recent years has been put under so much stress and risks I would really like to know today that HMRC and lenders will chase these scumbags to the ends of the earth to get their money back to the point of not excepting the time old excuse "well it's the wives money in'it",even by some mirav=cle it really is her own money.

 

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other sources...

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Richard Wilkinson, assistant director of the Fraud Investigation Service at HMRC, said: “Fuller thought he was above the law and decided not to declare or pay the tax due from the sale of some of his property portfolio.

“It is simply not acceptable to steal from UK taxpayers.

“HMRC will continue to pursue those who attempt to hide their gains on assets, their income, and investigate those who attack the tax system.”

http://www.getsurrey.co.uk/news/hampshire-news/church-crookham-landlord-who-thought-13465392


Zoopla (on the road address given for the LL):  The average house price in Bowenhurst Road, Church Crookham, Fleet GU52 is £469251

and recent Sold Prices point to about that too.

So the HPCers who think tax-evading BTLers deserve a kiss and a cuddle... no custodial... to pay backtax fine and penalty and go back to their 'productivity'.... 

Maybe he can do his time, pay the tax/back-tax and still be wealthy.  Maybe remain rich.   Or become a renter.   Sofa-surfing is what many a HPI VI has suggested for the young... if it's okay for the young, it can be okay from law-breaking BTLers (if it comes to it).  We have rules... laws.   And BTLers highly involved in laying claim (profiteering / attempting to) in a housing crisis/affordability/supply for the young.  Too bad.

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“The jury found you guilty of dishonesty. This is a serious matter, you deliberately failed to pay your Capital Gains Tax over several years,” said The Recorder of Salisbury His Honour Judge A J Barnett.

The 53-year-old had been found guilty by a jury of two counts of Cheating the Public Revenue and three counts of Fraud by False Representation to the tune of £157,725.

The HMRC says the fraud was discovered by its property task force and then referred for a criminal investigation. The outstanding tax due by Fuller will now be recovered through confiscation proceedings.

“Fuller thought he was above the law and decided not to declare or pay the tax due from the sale of some of his property portfolio. It is simply not acceptable to steal from UK taxpayers,” says Richard Wilkinson, Assistant Director, Fraud Investigation Service, HMRC.

“We will continue to pursue those who attempt to hide their gains on assets, their income, and investigate those who attack the tax system.

https://thenegotiator.co.uk/landlord-jailed-richard-fuller/

 

Edited by Venger

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1 hour ago, TheCountOfNowhere said:

Said something about HRMC were going to confiscate stuff.

Shoudl eb jailed till he pays :lol: 

Yes. Otherwise he's getting paid better for going to jail then 99% of the pouplation for going to work.

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One of the above links led to this....  https://thenegotiator.co.uk/suspended-jail-term-developer-landlord-former-agent-following-hmrc-probe/

Home » News » Agencies & People » Suspended jail term for developer, landlord and former agent following HMRC probe
AGENCIES & PEOPLE

Suspended jail term for developer, landlord and former agent following HMRC probe

Businessman with links to top echelons of industry evades jail but must pay £481,000 in back taxes and fines.

Nigel Lewis

13th March 2017 0 383 Views

 
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hmrc-620-300x200.gifA landlord, developer and former estate agent with links to one of the UK’s better-known franchisee agencies has been convicted of tax fraud following an HMRC investigation.

Michael Charles Waddingham, 44, was sentenced on Friday to two years in prison suspended for two years and has been ordered to pay back £281,000 in unpaid tax, plus a fine of £200,000.

The court case and conviction followed an investigation that found Waddingham had not submitted tax returns between 2008 and 2012. He failed to declare rental income from 17 properties as well as income from seven land and property development companies from which he earned over £100,000, the court heard.

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A landlord, developer and former estate agent with links to one of the UK’s better-known franchisee agencies has been convicted of tax fraud following an HMRC investigation

 

Gets even better.

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1 hour ago, Venger said:

If evaded £158K in capital gains tax from his landlording sale of properties, then seem around right.. 2 years and 3 months in nick + HMRC to go in to try and recover the tax and their costs from his other assets.

Nah get as many as possible when they evade over £5K... and especially larger sums... £10K+.

I don't see anything good in allowing dishonesty to get away with it... (the Let campaign run for years... CGT well known about... accountants)  for BTLers to keep their 'productive members of society' / 'other good incomes' (many BTLers also good incomes over the years).   In to gaol they should go for serious evasion.   Get the tax owed back + apply £ penalties too.   Honest people can be promoted/take their employment positions.

 

 

I agree with poster challenging jail terms for fraud and mine is a penal criminal justice issue rather than a 'should we punish someone' issue. 

The cost of jail is ridiculous and I have to pay for it. Violent criminals ie punching old man or woman unconscious in unprovoked attached by a serial thug...is a danger and needs to be locked up to protect physical harm to others. Instead they get 6 months and punch another person when released. I have seen this over and over. 

Geoffrey Archer and this BTL chap...removal of all assets. Yep, don't lock them up just remove wealth. So this chap cannot be trusted to own a BTL and has gained from it. Remove it completely including original investment. I don't mean 100% fine....I mean if the guy is worth £2m then take it. And every tax return from now (compulsory requirement even if he is just employed or just in benefits) must be audited and the audit costs paid for by him. If it's jointly held then that is confiscated too. I would be very aggressive on the penalty but we need to keep jails available for crimes which require someone to be locked away to protect others. 

I am not black/white on this and every case differs. Rather a guiding principal. 

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18 minutes ago, Phil321 said:

I agree with poster challenging jail terms for fraud and mine is a penal criminal justice issue rather than a 'should we punish someone' issue. 

The cost of jail is ridiculous and I have to pay for it. Violent criminals ie punching old man or woman unconscious in unprovoked attached by a serial thug...is a danger and needs to be locked up to protect physical harm to others. Instead they get 6 months and punch another person when released. I have seen this over and over. 

Geoffrey Archer and this BTL chap...removal of all assets. Yep, don't lock them up just remove wealth. So this chap cannot be trusted to own a BTL and has gained from it. Remove it completely including original investment. I don't mean 100% fine....I mean if the guy is worth £2m then take it. And every tax return from now (compulsory requirement even if he is just employed or just in benefits) must be audited and the audit costs paid for by him. If it's jointly held then that is confiscated too. I would be very aggressive on the penalty but we need to keep jails available for crimes which require someone to be locked away to protect others. 

I am not black/white on this and every case differs. Rather a guiding principal. 

Maybe Hmrc is using the guy as scare tactics to make others confess and pay up ?  a bit of paid jail time by the public purse may increase revenue far more. :rolleyes:

i think people need to look at the basics, less over thinking.

 

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2 hours ago, longgone said:

Maybe Hmrc is using the guy as scare tactics to make others confess and pay up ?  a bit of paid jail time by the public purse may increase revenue far more. :rolleyes:

i think people need to look at the basics, less over thinking.

HMRC can only bring the prosecution.

There was a jury who found him guilty, and Judge followed whatever guidelines about sentencing.  

Although can accept your point about HMRC bringing the prosecution perhaps to those ends (criminal conviction / prison sentence) and maybe more BTLers/future BTLers feeling unease about their own positions. 

Quote

 

A Hampshire landlord who evaded £158,000 of capital gains tax from the sale of properties has been jailed for two years and three months.

.......Sentencing Fuller, Judge A J Barnett, said: “The jury found you guilty of dishonesty.

“This is a serious matter, you deliberately failed to pay your capital gains tax over several years.”

 

 

Phil321 it's something for me to think over, but I was pushing back against the other poster's point of BTLers avoiding a criminal conviction on tax-evasion so they can continue reaping in £ in whatever other line of work they are in.  

If they are dishonest (tax evasion to a significant amount) there's a price to pay for that, and it may do their employers a service to know about it, with a criminal conviction (although perhaps not involving jail time for less serious offences)

Solicitor got struck off, just the other day, because did not declare stamp duty correctly.    Other articles went further into how he attempted to keep it quiet.... but as I recall it....  in that other HPCer's view it should be straight back to the solicitor practising again.

http://www.legalfutures.co.uk/latest-news/solicitor-tried-avoid-paying-stamp-duty-firm-office-purchase-struck-off

https://www.lawgazette.co.uk/news/property-solicitor-banned-for-avoiding-50k-stamp-duty/5062439.article

https://www.todaysconveyancer.co.uk/news/solicitor-struck-off-trying-avoid-stamp-duty/

There was a really amusing quip in one of the articles about it... can't find that article atm.  How it was right for it to come to attention of SRA.  

If it's a lot of evasion money involved and the BTLer individual has lied/taken great measures to prevent discovery, then custodial sentence seems appropriate.  Cheating the Revenue/all of us - and with housing profiteering, others pay the costs (renter-savers) in many many ways vs HPI/HPI forever / HPI... and cash out without paying correct CGT.. to reap galore.  

All depends on individual circumstances, but conviction (without prison time) seems right to me in for £10K+ evasion.

Your position on unlimited fine is tougher than my own!   It's very tempting to agree with you because it's BTLers and tax evasion, but I am wary of going for an entire asset/savings grab, in case it followed into other things.   I agree with proportionate fines/outcomes to the circumstance of the situation.   (Like good Moderators do with forum here.) What's HMRC's max fine?   x200% tax evaded?  

Unlimited fines... well I just wary of some sort of penalty-creep.... don't want to find my savings gone on some low-level matter (not that I can think of anything I might breech by accident atm) and wary of future abuse of power/system.  

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15 minutes ago, Venger said:

"Unlimited fines... well I just wary of some sort of penalty-creep"

For my two pence, I have to agree with Venger on that one.

One can't help a certain schadenfreude when a spiv gets their just deserts, but the backlash and future rules have a nasty habit of hitting the innocent and the guilty alike and let's face it, if the powers that be have proven anything, they have proven that they are perfectly capable of abusing their power

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It was a guess (200%).

And I recall the powers that Pressy (Accountant/Tax specialist) suggested HMRC have under POCA ('take it all').

Maybe there should be some 'special circumstances' for HMRC against big crime / tax-evaders, way over 200%... provided the person has opportunity to legally challenge it...?

Although am wary, as Switch625 says, over unlimited fines.   

Quote

attempted to dissuade the HMRC from making public the fines it subsequently issued so as not to alert the Solicitors Regulation Authority.

Read this the other day.. 

Quote

Which brings me back to my opening question. Just how private are your own tax affairs? 

https://www.sportsscore.co.uk/blog/2017/6/21/how-private-are-your-tax-affairs

Private (unless we have lawful authority to do so), but I guess information comes out under prosecutions or fines (as in the BTLer OP CGT evasion), or where person involved has to abide by serious rules/honesty in their own profession?

Edited by Venger

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1 hour ago, Venger said:

Solicitor got struck off, just the other day, because did not declare stamp duty correctly.    Other articles went further into how he attempted to keep it quiet.... but as I recall it....  in that other HPCer's view it should be straight back to the solicitor practising again.

http://www.legalfutures.co.uk/latest-news/solicitor-tried-avoid-paying-stamp-duty-firm-office-purchase-struck-off

https://www.lawgazette.co.uk/news/property-solicitor-banned-for-avoiding-50k-stamp-duty/5062439.article

https://www.todaysconveyancer.co.uk/news/solicitor-struck-off-trying-avoid-stamp-duty/

There was a really amusing quip in one of the articles about it... can't find that article atm.  How it was right for it to come to attention of SRA.  

Here it is.. but not sure why RollOnFriday (I always check in to see Glamorous Solicitor of The Week, .. and then year... along with other things) has it dated as 2014..... where other links above 2017 (guy with same name).

Was it an earlier case or coincidence with same name, or just a bug in ROF's dating system, or just something that has rolled on from 2014 to 2017 until Strike Off?  (most likely?) ... I cba to check the £numbers to see if they correspond in other Stamp Duty articles.

 

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A property lawyer fined by HMRC for not paying Stamp Duty Land Tax on his £760,000 home has lost his fight for anonymity.
22 August 2014


In 2010 Richard Chan declared on his SDLT return that his house cost £100,000, which conveniently put it below the threshold for SDLT. When HMRC opened an investigation it discovered that the purchase price was actually £763,750, and £30,550 in SDLT was due.

Chan paid both the tax and, fearful of being publically named as a wrongdoer, the £16k penalty HMRC imposed on him for submitting a deliberately inaccurate return. Unfortunately the tax man told him that by paying the penalty he had admitted his guilt and, as a result, it was definitely going to release his details. Chan appealed to the Tax Tribunal.

 Cornwall-Terrace_6_1172310a.jpg   A £100k house yesterday 


His appeal went poorly. Judge Barbara Mosedale said Chan's evidence "did not show him to be a person of high ethical standards". She blasted his claim that publication of her decision would be libellous if it contained his name ("as a matter of law, it is not") and slapped down his argument that his name shouldn't be revealed because he could get into trouble with the SRA, explaining that, "far from justifying anonymity, [Chan's position as a solicitor] positively favours full publication".

Until recently Chan was being praised in the legal press for the explosive growth of his firm, Arc Property Solicitors. Alas, last year the SRA closed it down and ordered Chan to appear before the Solicitors Disciplinary Tribunal for alleged failings including acting in conflicted transactions, mixing up client cash and, yes, SDLT avoidance at the firm. 

If Chan isn't struck off on those charges at his SDT hearing in September, he should probably keep the champagne on ice. As he suspected, the SRA has pricked up its ears at the latest revelation. A spokesman said "In terms of the court’s decision...we would expect all solicitors to report such matters to us. We are aware of the judgement and are considering what options are available to us to address any risks this solicitor might pose".

http://www.rollonfriday.com/TheNews/DodgySolicitor/tabid/380/Id/3494/fromTab/380/currentIndex/11/Default.aspx

 

Edited by Venger

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1 minute ago, Option5 said:

That we know of........

And if he didn't have the money to actually pay the correct amount of SDLT at the time (back in 2010 it seems @ £763,750)...

.... well at least the SDLT evasion wheeze probably may mean the house is worth twice as much in 2017.

Mad Gainz.

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His appeal went poorly. Judge Barbara Mosedale said Chan's evidence "did not show him to be a person of high ethical standards". She blasted his claim that publication of her decision would be libellous if it contained his name ("as a matter of law, it is not") and slapped down his argument that his name shouldn't be revealed because he could get into trouble with the SRA, explaining that, "far from justifying anonymity, [Chan's position as a solicitor] positively favours full publication".

The bailii record of Tribunal findings is of some interest about HMRC and their approach to tax-evader publication.... there if/when they catch more BTL/HPIer tax-evaders / other tax evaders.

Hello Section 24.

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........

Findings of fact

1.             The appellants are married.  In 2010 they jointly purchased a property.  It cost them £763,750.  On the Stamp Duty Land Tax (“SDLT”) return the purchase price declared was £100,000.  No SDLT was paid:  SDLT of £30,550 was due.

2.             HMRC discovered this in 2011 when they opened an enquiry.  The appellants, on the matter being brought to their attention, paid the outstanding SDLT of £30,550.

3.             In letters dated 13 April 2011 HMRC asked for information and warned the appellants (& the appellants' adviser) that HMRC was considering imposing a penalty.  The letters to the appellants included two sets of guidance notes.  The first was “Compliance checks – general information” and the second was “Compliance checks – penalties for errors in returns or documents.”  The first said, amongst other things:

“what to do if you disagree

If you disagree with anything during the check please tell the officer dealing with the check what you disagree with and why.

You can appeal against most of the decisions that we make.  We will write and tell you when we make a decision that you can appeal against.  We will also explain the decision and tell you what to do if you disagree.....”

4.             The second of the guidance notes explained when HMRC would impose a penalty and how it would be calculated.  It included a similar “what to do if you disagree” paragraph.  The penultimate section of the guidance was as follows:

When we may publish details about you

We may publish the name, address, and other information about those who deliberately evade tax.  We may be able to publish information about you if:

-we charge you a penalty for a deliberate, or a deliberate and concealed, inaccuracy, and

-the tax on which the penalty … is based is more than £25,000....”

 

 

Quote

 

  The enclosed guidance note explained HMRC's view of the law contained in s 94 Finance Act 2009 (“FA 9”).  On the third page it said, after setting out the five publication questions:

[.....]

[.....]

As soon as the penalties become final, the officer will refer your case to the specialist team that is responsible for publishing details of deliberate defaulters.  The team will not have been involved in your compliance check.

A senior civil servant in the team will decide whether we can publish your details...

To be fair and consistent, we aim to publish the details of every person, company, or other kind of organisation where the answer to all of the five publication questions is 'yes'.  We will only decide not to publish in exceptional circumstances.”

And a lot more good stuff in there.

 

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