Property developers banned over tax debt
10 Aug 2020
Two Scottish property developers have been disqualified after failing to pay tax on a land deal
10 Aug 2020
Richard Black, from Collessie, and William Edmiston, from Kirkcaldy, have been banned from acting as a director for a total of 13 years.
Incorporate in April 2002, Mellerstain Developments developed building projects in central Scotland, but experienced financial difficulties and entered into liquidation in August 2018.
An investigation by the Insolvency Service uncovered that in June 2016, two years before the company went into liquidation, Mellerstain Developments sold land to two of the company’s directors, Black and Edmiston.
The land was the last asset that the company owned and at the point when it was sold, the company owed the tax authorities more than £31,000, having agreed to settle the debt before November 2020.
Mellerstain Developments, however, paid just over £24,000 to Edmiston from the proceeds of the land sale and just under £11,000 was paid in cash to an undisclosed party, while nothing was paid to the tax authorities to settle the outstanding liabilities.
Rob Clarke, chief investigator for the Insolvency Service, said: ‘Directors have a duty to ensure the correct amount of tax is paid but Richard Black and William Edmiston clearly thought the rules didn’t apply to them.
‘Thankfully their activities were brought to the attention of the Insolvency Service. Their bans should serve as a stark warning to other directors there are severe consequences if you put your interests ahead of your creditors.’