City newsagent banned over £1 million tax scam

A DUNDEE newsagent paid for home improvements and private education with a £1 million tax scam lasting 17 years.

Mohammed Arshid, 61, of Broughty Ferry, has now been disqualified from acting as a director of any company for 11 years after a probe by tax inspectors.

Authorities said his actions resulted in lost revenue on PAYE tax, National Insurance Contributions, VAT and Corporation Tax totalling £1,020,423.

And his wife Maqsoodan, 57, has been barred for two years for allowing the offence to take place and benefiting from it.

Mr and Mrs Arshid were both directors of Nethergate Newsagents Limited, which was placed into compulsory liquidation i n 2014 with debts of £1,044,973.

The liquidation took place after HMRC conducted a fiveyear investigation which established that Mr Arshid caused the company to under-declare and conceal liabilities.

It was found that, for 17 years, Mr Arshid hid liabilities owed to HMRC for PAYE tax and NIC through submitting false P35 End of Year Returns, resulting in lost revenue, inclusive of penalty charges, totalling more than half a million pounds.

Over a similar time period, he concealed liabilities owed to HMRC for VAT through hiding sales, resulting in lost revenue, including penalty charges, of £170,182.

Over three consecutive financial years up to 2007, he submitted i ncorrect company tax returns and in the following six years he understated the company’s sales resulting in lost revenue including penalty charges of more than £200,000.

A spokesman for the Insolvency Service said: “By their own admission, the cash misappropriations from the company allowed Mohammed and Maqsoodan Arshid and their family members to achieve personal gain i ncluding home improvements, private education and topping-up of employee wages.”

Robert Clarke, group leader for Insolvent Investigations North, said: “Directors who put their own personal financial interests above those of customers and creditors damage confidence in doing business and are corrosive to the health of the local economy. These bans should serve as a warning to other directors tempted to help themselves first; you have a duty to your creditors and if you neglect this duty you could be investigated by the Insolvency Service and removed from the business environment.”

No-one at the Arshid family home was prepared to comment on the case today.

Mohammed Arshid has been banned from acting as a director of any company for 11 years.