Building company director banned for 7 years for VAT under-declaration
The director of a building firm in West Wales has been disqualified from acting as a director for under-declaring sales on VAT returns.
Judie Thomas, aged 55, a company director from Carmarthen, has given a disqualification undertaking for 7 years.
The disqualification is as a result of investigations undertaken by The Insolvency Service which demonstrated that Judie Thomas had caused or allowed A&J Thomas Holdings Ltd to under-declare sales on VAT returns. As a result of the under-declarations a debt became due to HMRC who are owed £95,322.
Judie Thomas was the sole director of a West Wales building company trading as A&J Thomas Holdings Ltd which went into liquidation on 20 April 2015. Ms Thomas has given an undertaking to the Secretary of State for Business, Energy and Industrial Strategy, which prevents her from being directly or indirectly involved in the promotion, formation or management of a company for seven years from 26 September 2016.
In January 2014 HMRC undertook investigations into the company’s VAT returns and determined that sales figures had been under-declared in at least 6 VAT periods from December 2011 to December 2013. The HMRC investigation also determined that Ms Thomas failed to ensure that all VAT returns were submitted on time with the earliest unpaid return being for the period 09/09.
The company went into liquidation on 20 April 2015 owing £129,322 to creditors, of which £95,322 was the sum due to HMRC for under-declared sales on VAT returns and assorted miscellaneous sums due for Corporation Tax, PAYE and interest and penalties.
Stephen Baxter, the Official Receiver who oversaw the investigations, said:
This disqualification demonstrates that directors who fail in their obligations and cause creditors to lose money can expect to be investigated by the Insolvency Service and enforcement action taken to remove them from the market place.
Notes to editors
Judie Thomas is of Carmarthen and her date of birth is 21 July 1961; she was the sole registered director from 14 March 2007.
A&J Thomas Holdings Ltd (Company Reg no.06161184) was incorporated on 14 March 2007.
The company went into liquidation on 20 April 2015. On 5 September 2016 the Secretary of State for Business, Energy and Industrial Strategy accepted a Disqualification Undertaking from Ms Thomas, effective from 25 September 2016 for a period of 7 years.
The matters of unfit conduct were that Ms Thomas failed to ensure that A&J Thomas Holdings Ltd (A&J) submitted accurate VAT returns, in that sales were under declared in at least 6 VAT periods between December 2011 and December 2013. Further to this she has also failed to ensure that all VAT returns were submitted on time with the earliest unpaid return being for the period 09/09. This has resulted in VAT liabilities at liquidation totalling at least £81,033 (inclusive of interest and charges). In that:
VAT liabilities have been incurred for the period 09/09, 12/11, 9/12 – 12/13 and 6/14 – 6/15. The missing periods are due to these returns resulting in a VAT refund being due to A&J. The liability has largely been incurred following a VAT inspection in January 2014 where it was determined that sales on VAT returns had been under-declared for each of the periods from 12/11
the VAT returns originally submitted to HMRC showed refunds due to A&J of £13,722, however following the inspection by HMRC the amount was recalculated as £58,667 due to HMRC from A&J in respect of VAT. No payments were made to HMRC in respect of VAT in the periods covered by the VAT inspection as the original returns indicated that VAT refunds were due. There is an outstanding liability in respect of VAT of at least £62,151 plus surcharges / interest totalling £18,882
the under-declaration of sales was due to the accountant not being provided with full sales information when the VAT returns were completed. The discrepancies between the VAT returns and the end of year accounts were notified to Mrs Thomas by the accountant but she failed to authorise them to notify HMRC
A&J’s liabilities at the liquidation totalled £129,322. Of these liabilities HMRC are owed £95,322, a trade creditor is owed £1,023 and a contractor is owed £32,977.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Persons subject to a disqualification order are bound by a range of other restrictions.
The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
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Published: 13 September 2016
From: The Insolvency Service