Takeaway Owner convicted of £20,000 VAT Fraud

A 37-year-old takeaway owner from Derby has received a conviction after he deliberately underpaid more than £20,000 in VAT.

Takeaway Owner convicted of £20,000 VAT Fraud f

"he under-reported the true business turnover on that restaurant."

Takeaway owner Paramdeep Kaila, aged 37, of Littleover, Derby, received a suspended sentence after he deliberately underpaid more than £20,000 in VAT.

Derby Crown Court heard he took money from the Pizza Kitchen in Nottingham Road via his business bank account and instead moved it through his personal one.

An investigation was launched by HMRC which showed he was not declaring to them the true sales he was taking at the restaurant.

The prosecutor Jonathan Dunne said Kaila owned the Pizza Kitchen between August 1, 2014, and January 31, 2017.

During that time, Kaila under-reported the true sales figures he achieved to HMRC to around £23,407.48.

Mr Dunne said: “It works out at around £3,000 each reporting quarter.

“The turnover was syphoned off and instead of the money going to his business account it went into his personal account.

“In short, he under-reported the true business turnover on that restaurant.

“Matters came to light, an investigation was launched and in interview, he gave ‘no comment’ answers to the questions he was asked.”

Kaila pleaded guilty to one count of fraudulently evading to pay VAT. He has no previous convictions.

In mitigation, Justin Wigoder said his client “had never engaged in the restaurant business before” and that the firm was wound up in 2018.

He added: “It was a fraud but there were periods when it was being done properly.”

The restaurant is currently under new ownership. Meanwhile, Kaila was working in what was described as “a completely different sphere of activity”.

The takeaway owner was sentenced to 12-months in prison, suspended for a year.

Recorder Adrian Reynolds said: “Mr Kaila, self-employed people, whether it is what you used to do or what your defence counsel does, are under an obligation to behave honestly in relation to accounting, VAT and dealing with the HMRC.

“If people don’t behave honestly it encourages people to behave dishonestly and the tax system turns into chaos.”

“Everything I have read and heard about you tells me you are a decent family man and you have let yourself down badly.

“I am going to suspend your sentence because I am entirely confident you will not behave like this again.

“You have a good job now in a completely different sphere of activity and provided you don’t re-offend again in the next 12 months that will be the end of matters.”

Derby Telegraph reported that in addition to the suspended sentence, Kaila was ordered to pay £3,000 towards the costs of HMRC’s investigation.

After sentencing, Nick Stone, assistant director for the fraud investigation service at the HMRC, said:

“Kaila attempted to steal money from honest taxpayers at the expense of our public services.

“Anyone with information about tax fraud can report it online or by calling our Fraud Hotline on 0800 788 887.”

Dhiren is a journalism graduate with a passion for gaming, watching films and sports. He also enjoys cooking from time to time. His motto is to “Live life one day at a time.”