An uncle and nephew team who ran a kebab takeaway in Camden have been banned from holding directorships for 14 years for suppressing takings.
Following collaboration between the Insolvency Service and HMRC, Genc Ali Demir (53) and his nephew Mehmet Demir (26) have been disqualified from acting as company directors for seven years each after they suppresed takings and sales that had been omitted from submitted VAT returns.
The disqualifications relate to Mehmet Ali and his uncle?s management of Camden Kebab Ltd, which traded as kebab takeaway ?Real Taste? from 44 Camden High Street, North West London.
The Companies House register listed Mehmet Ali as the only registered director of Camden Kebab Ltd but investigations showed that his uncle played a key role in running the business.
An in-depth HMRC investigation revealed that the company had failed to record all of its takings and had therefore under-declared the VAT due to HMRC. As a result, HMRC raised a VAT assessment of ?71,474.
During May and June 2016, HMRC carried out further investigations which uncovered, among other things, that the company ran a cash-only business and that the books and records it ought to have kept were inadequate and/or unsatisfactory.
At liquidation on 21 April 2017, HMRC stated that the company owed in excess of ?297,000 for arrears of VAT, Corporation Tax and penalties.
HMRC issued Personal Liability Orders against both Genc Ali Demir and Mehmet Demir as their investigations led them to conclude both individuals ran the business despite officially it only being Mehmet Demir. Further investigations by the Insolvency Service following the company?s liquidation, confirmed the findings by HMRC.
As a result, Genc Ali Demir and Mehmet Demir gave disqualification undertakings which were accepted by the Secretary of State for Business, Energy & Industrial Strategy, on 5 and 9 April, respectively.
The disqualifications mean that both Genc Ali Demir and Mehmet Demir cannot be directors of a company whether directly or indirectly, or be involved in the management of a company in any way for the duration of their disqualifications ? from 26 April and 30 April respectively - unless they have permission from court.
Lawrence Zussman, Deputy Head of Investigations with the Insolvency Service, said:
These disqualifications send a clear message to other company directors that tax abuse of any kind, particularly when it comes to suppression of takings by directors, will not be tolerated.
Much of the public service is funded by the correct amount of taxes being paid. By not declaring and paying the correct amount of taxes, the public has been deprived from receiving the services it deserves from the public sector.
Further, whether you are a registered director or not if there is evidence that demonstrates you acted in the capacity of the management of a company the Insolvency Service will be proactive in taking action against you which could result in disqualification as is the case here.