A Liverpool couple who ran a pub and garage in the city have been jailed for a total of seven years for a £470,000 tax and benefit fraud
Members of the Knutsen family ran Chaplin’s Bar on Lodge Lane and a car repair garage on Hill Street, but failed to pay any VAT, National Insurance contributions (NICs) or income tax while also fraudulently claiming benefits.
HMRC investigators found Bernard Knutsen ran the Hill Street garage – which was known at various times as Able Testing, Hillside Services and The Service Station – and failed to pay any VAT, income tax or NICs. Over £64,000 in VAT was found to be owing.
He did the same with Chaplin’s Bar, which he ran with the help of his wife Maureen, and which owed £104,884 in VAT.
The pair failed to declare their income from the businesses when claiming various benefits.
Their daughter Kelly Ann received unexplained money from both businesses into her bank account. She also claimed benefit to cover her rent but failed to declare a second property she owned and rented out.
Following their trial at Liverpool Crown Court Bernard Knutsen was jailed for four years, his wife Maureen for three year, and their daughter Kelly Ann was jailed for 21 months suspended for two years.
Family friend Gary Hyland, who was also involved in the fraud, was given a two-year community work order with 12 months supervision and a three-month curfew for benefit fraud. He did not declare his rental income to HMRC and the Department for Works and Pensions (DWP).
Hyland lied about his involvement in Chaplin’s Bar to secure a £13,000 loan to buy a caravan. He admitted being a front for the business and had no financial involvement in it. He also failed to declare he was renting out a property he claimed to live at for his benefit claim.
Sandra Smith, assistant director, HMRC fraud investigation service said: ‘This family thought they were exempt from the law. You cannot decide to ignore your tax obligations and not expect HMRC to take action. We are determined to maintain a level playing field for all local businesses and will not tolerate fraud like this.’
The joint HMRC/DWP investigation found other individuals claiming benefits without declaring income received while working for or with the Knutsens. These individuals were investigated separately by DWP.
Report by Pat Sweet
