This article was originally produced by the Insolvency Service and was published on 9th February 2018. The original version of the article can be found by clicking here.
Tuncay and Leyla Saglam, directors of Mr Cod Morden Ltd, have each been disqualified from acting as company directors for seven years.
The Secretary of State for Business, Energy and Industrial strategy accepted disqualification undertakings from Tuncay Saglam (51) and Leyla Saglam (50) meaning neither shall not be a director of a company whether directly or indirectly, or be involved in the management of a company in any way for seven years unless they have permission from court.
The disqualifications follow collaboration between the Insolvency Service and HMRC, whose investigations established that Mr and Mrs Saglam caused or allowed the company to submit inaccurate statutory VAT returns to HMRC by the deliberate suppression of sales income being to their benefit.
An in depth HMRC investigation revealed that the company had failed to record all of its cash takings and had therefore under-declared the VAT. As a result, HMRC raised a VAT assessment including interest and civil penalties of over £168,000. Additionally, HMRC also reassessed the company’s Corporation Tax liability to be in excess of £210,000 and raised Corporation Tax penalties in excess of £141,000.
At liquidation, HMRC stated that the company owed in excess of £545,000 in relation to arrears of VAT, PAYE and National Insurance Contributions, and Corporation Tax.
Commenting on the disqualification, Lawrence Zussman, Deputy Head of Investigations with the Insolvency Service said:
The periods of these disqualifications sends a clear message to other company directors that tax abuse of any kind, particularly when it comes to suppression of cash takings by directors will not be tolerated.
Defrauding the Exchequer of taxes, deprives the public services of much needed funds required to ensure the public receives the services it rightfully deserves.
The Insolvency Service will therefore not hesitate to take action against directors so they cannot abuse limited liability provided by trading through a company.
