Restaurateurs served with bans over tax failures
24 Jul 2020
Two restaurateurs have been disqualified from managing companies after they caused their outlets to abuse the tax regime, owing more than £1m in tax between them
24 Jul 2020
Paul Podvoiskis, from Sherbourne, Warwickshire, was the director of Candy Experience Ltd, which ran public houses and restaurants across the south west of England.
These included Ringwood, Cadnam and Lymington in Hampshire, as well as three restaurants trading under the name Alcatraz Bar & Brasserie in Bournemouth and Poole in Dorset, and Camberley in Surrey.
However, Candy Experience failed to submit monthly VAT returns from August 2015 up until the date of the company’s liquidation in June 2016. It also owed outstanding PAYE and National Insurance contributions dating back to 2014/15 and failed to settle its tax liabilities.
At the point of liquidation, the tax authorities claimed more than £470,000, which remains outstanding.
Further enquiries established that Candy Experiences’ bank records received more than £3.8m into its account. Just over £115,000 was paid to the tax authorities, plus £1,153 in business rates to the local authorities.
The remaining £3.68m, however, was used by Candy Experience to pay trade creditors, wages and other operational costs, including more than £779,000 paid to a connected company.
Allan Ho, from Coatbridge, North Lanarkshire, was a director of Allyan Ltd which traded as a takeaway restaurant called Canton Cuisine from Union Street, Larkhall.
However, the company ceased to trade in November 2018 before being wound-up by the courts in July 2019 following a petition from the tax authorities.
After the company was liquidated, investigators uncovered that for nearly six years between November 2010 and August 2016, Ho caused Allyan Ltd to deliberately suppress its sales and delivery income in order to conceal its true tax liabilities.
The tax authorities raised several tax assessments to recover tax owed and by November 2018, Allayn Ltd’s tax liability increased to more than £500,000, which also included penalties for deliberate concealment.
In the absence of payment from the company the tax authorities lodged a winding up petition resulting in the company being placed into compulsory liquidation in July 2019.
Podvoiskis received a five year court-ordered disqualification, while Ho accepted a nine year disqualification undertaking.
Keith Owen, director of investigations and enforcement services for the Insolvency Service, said: ‘The majority of directors take their responsibilities seriously but Paul Podvoiskis and Allan Ho both deliberately caused their companies to abuse the tax regime, when they failed to pay the correct amount of tax.
‘Both restaurateurs have received substantial bans for their misconduct and this should serve as a clear warning to other directors that neglecting their statutory duties could lead to being removed from the corporate arena.’
By Pat Sweet