Secret curry purchases help HMRC catch tax evader

indian restaurant tax evasion

The owner of an Indian restaurant in Staffordshire has been jailed for two years after stealing £90,000 in tax after test purchases revealed his fraud.

Monir Miah, 58, admitted lying about his income from The Crown of India restaurant, in High Street, Stone, and falsifying VAT repayment claims, after he was investigated by HM Revenue and Customs (HMRC).

Routine tax checks raised concerns and Miah was offered the chance to put his tax affairs in order, declare any mistakes or irregularities and pay what he owed in full, plus interest and penalties, through HMRC’s civil Contractual Disclosure Facility (CDF) known as ‘COP9’.

But Miah only declared half the business the restaurant was doing and deregistered for VAT because the restaurant was allegedly doing so badly.

HMRC began a criminal prosecution as Miah had failed to make a full disclosure and continued to lie about his business. The investigation clearly showed how he was illegally under-declaring the true scale of his restaurant business.

HMRC officers discovered the truth by tracing customer payments, counting customers on the premises, and doing test purchases on specific dates, which were compared with his records and tax returns.

Paul Maybury, Assistant Director, Fraud Investigation Service, HMRC, said: “While Miah, and his family, enjoyed the illegal untaxed income from his restaurant he was depriving public services of vital funding and gave himself an unfair advantage over his honest competitors.

“He was offered the opportunity to put his tax affairs in order through the Contractual Disclosure Facility. Instead he made a conscious decision to make only a partial disclosure of the tax offences he had committed. He could have been spared a criminal conviction had he fully cooperated with HMRC.

On sentencing Miah, His Honour Judge Walsh said the crime was “was sophisticated in the way it was carried out. It was an intentional act of dishonesty on your part and you were given opportunity in 2016 to come clean but declined that opportunity.

“It was a calculated dishonesty designed to achieve a significant financial benefit to yourself and a loss to the revenue.”

Miah becomes the sixth person to be convicted for failing to comply with the Contractual Disclosure Facility (CDF) in the last 18 months.

HMRC is in the process of recovering the stolen tax.