Property pair jailed for £1m tax fraud
20 Jan 2020
Two men who bought and sold over 50 properties but failed to pay nearly £1m in tax, have been jailed for more than eight years following an HMRC investigation
20 Jan 2020
Madhu Bhajanehatti, of London and Himat Chana, from Ilford, Essex, sold dozens of properties over an eight-year period, and evaded £991,000 in capital gains tax.
An HMRC investigation found that although the men disclosed some income on their self-assessment tax returns, they deliberately hid the sales of properties across London and Essex.
A specialist property taskforce set up to tackle fraud in the industry discovered the men had built up their property portfolios by using the proceeds of previous sales. Bhajanehatti evaded £650,000 in tax and Chana evaded £341,000.
Bhajanehatti admitted the fraud during a hearing at Southwark Crown Court in June 2019. Chana was convicted after trial in August 2019. Both have now been sentenced, with Bhajanehatti given a 50 months jail term and Chana sentenced to 52 months in jail.
Bhajanehatti was also ordered to pay back £190,086 in a confiscation order. He has less than three months to pay it back or he faces a further two years and six months in jail. Confiscation proceedings for Chana are on-going. If further assets are identified in the future for Bhajanehatti, they could also be confiscated.
Richard Wilkinson, assistant director, fraud investigation service, HMRC, said: ‘The duo believed they were above the law and showed a blatant disregard to their obligations by failing to declare substantial income from property sales.’