A construction company owner who stole £300,000 in Income Tax and VAT has been jailed for two years, after a joint investigation by HM Revenue and Customs (HMRC) and the Insolvency Service.
Leonard Gjini, 33, from Purley, Greater London, set up Croydon-based Leo’s Construction Services Ltd in April 2010, but failed to pass HMRC any of the tax he deducted through PAYE from employees’ salaries, or from contractors’ wages under the Construction Industry Scheme. He also pocketed the VAT he charged clients.
Alan Tully, Assistant Director, Fraud Investigation Service, HMRC, said:
“Gjini ran a relatively successful business, but by the time he finally admitted the fraud, he had built up a huge debt. He has defrauded HMRC and abused the trust of his clients and his employees.
“Failing to pay taxes will not be tolerated and it’s unfair to other legitimate businesses who pay their taxes on time. We are determined to stamp out tax fraud and will not hesitate to work with partners like the Insolvency Service to take action against cheats. Our next step is to reclaim the profits Gjini made committing this crime.”
Gjini claimed he used the money to fund his gambling and drinking habits, but in reality it was mostly used to fund household expenses and mortgage payments.
The joint-investigation revealed that in addition to the tax fraud, Gjini had not kept proper records for the two years Leo’s Construction Services Ltd was trading. In July 2012 the company went into a contrived liquidation, as an attempt to evade paying the tax due.
Gjini pleaded guilty to VAT evasion and cheating the public revenue on 26 January 2016, and was jailed for two years at Croydon Crown Court.
Confiscation proceedings under the Proceeds of Crime Act are being taken.
Notes for Editors
- Leonard Gjini, DOB 16/03/82, of Haydn Avenue, Purley, Greater London, a Kosovan born builder and former owner of Leo’s Construction Ltd based in Croydon.
- Gjini admitted the fraudulent evasion of VAT, between May 2011 and July 2012, contrary to section 72(1) of the Value Added Tax Act 1994; and to cheating the public revenue, between April 2010 and July 2012, contrary to Common Law. The total fraud is £300,000. Four other counts will remain on file.
- He was sentenced to two years for each offence, to run concurrently, at Croydon Crown Court today (26 January 2016).
- Anyone with information about people or businesses involved in tax fraud can call the Customs Hotline on 0800 59 5000 or report it online at: www.gov.uk/topic/dealing-with-hmrc/tax-compliance
- The Insolvency Service is an executive agency of the Department for Business, Innovation and Skills (BIS). It 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. Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
- Follow HMRC’s Press Office on Twitter @HMRCpressoffice
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Issued by HM Revenue & Customs Press Office
HM Revenue & Customs (HMRC) is the UK’s tax authority.
HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support.