The managing director of a clothing chain, who failed to pay his VAT in full and pocketed almost £68,000 in tax and national insurance contributions deducted from employees’ wages, has been jailed for 18 months.
HM Revenue and Customs (HMRC) investigators examined the accounts of Punkyfish (GB), which operated in Birmingham, Leicester and the South East, and discovered Kemal Gediz, had deliberately under-declared his sales to avoid paying between £300,000 and £500,000 in VAT.
In May 2011 the 49-year-old submitted a VAT return for Aliko, trading as Punkyfish.
The return showed sales of £1.2 million for an 18 month period from November 2009.
HMRC made a visit to Gediz and discovered paperwork showing sales were in fact £7.3 million, some £6 million more than he had declared, resulting in a VAT underpayment of between £300,000 and £500,000.
Further checks revealed Gediz had also failed to file any tax forms or pay the Pay As You Earn (PAYE) and National Insurance contributions he had deducted from the salaries of approximately 70 staff. These contributions totalled around £67,600.
Gediz, of Forest Road, London, pleaded guilty to the offences in April and was sentenced on May 17.
David Margree, assistant director criminal investigation, HMRC, said: “Kemal Gediz’s idea of getting ahead in business was to falsify his accounts and steal from his own employees. In doing so he deceived not only HMRC and his staff, but also the thousands of businesses that operate honestly and within the law.”