The co-owner of a Hampshire chain of children’s nurseries who failed to pay around £950,000 in tax deducted from his employees’ salaries to HMRC has been jailed for five and a half years and suspended from being a company director for ten years
Michael Scot defrauded more than 180 employees by deducting PAYE, income tax and National Insurance Contributions (NICs) from the salaries of his workers, but then failed to declare and pay the money to HMRC. He also failed to declare and pay employer National Insurance.
HMRC began an investigation after former employees raised concerns about gaps in their income tax and National Insurance records. This found that Scot had been failing to make payments for more than four and a half years, between April 2007 and November 2011.
Scott was found guilty by a jury at Southampton Crown Court. The trial heard evidence he owned a substantial property portfolio and a private aircraft.
Upon sentencing His Honour Judge Henry said: ‘Fraud against the Revenue goes to the heart of society, but millions pay their taxes year in year out. This is a cheat of your fellow citizens, but the group you put at substantial risk is your staff. Your actions put in jeopardy their rights and entitlements.’
John Cooper, HMRC’s assistant director of criminal investigation, said: ‘Michael Scott brazenly robbed his employees and lined his own pockets at the expense of the wider taxpaying public. Tax was deducted and shown on payslips but the money was not handed over to HMRC, leading to gaps in employees’ tax records.’
Confiscation is being sought to recover the proceeds of Scott’s crimes, and HMRC said it was assisting former employees with gaps in their PAYE history.
