Every week, thousands of construction companies hand over large sums of money to external payroll firms, trusting them to make the correct payments to subbies and HMRC.
But what if it turns out that your tax and earnings transfers are actually lining the pockets of criminals and rogues who are out to cheat the taxman?
You might think it couldn’t happen to you. But scam payroll companies that prey on our industry are – sadly – nothing new.
A couple of years ago, we reported on a rogue called Victor Shearer. His fraudulent construction services company stole £6.9 million. The cash came from clients who thought they were making payments for CIS deductions, income tax, NI contributions and VAT. Shearer, from Kent, laundered it through offshore banks and then splashed out on expensive holidays, flashy cars and – ironically – on property. He was jailed for seven-and-a-half years.
It turn out that the ‘Mastermind’ behind the Victor Shearer fraud is a man who used to work for HMRC itself.
Just suppose you were looking for a new payroll company today. Someone whose website says: “I am a tax consultant and former Inland Revenue employee” sounds like a safe bet, right?
Mike Hughes went rogue and was in league with Shearer and others to steal from construction companies – by way of a string of offshore companies and bank accounts – until fleeing the country as the net closed in. He evaded justice until January this year when HMRC investigators arrested him at Heathrow.
I am delighted to say he has now been jailed for nine-and-a-half years.
Read the previous article here
Founder & Chairman, Hudson ContractMore from this expert
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