Sheffield company director is jailed for over five years after he committed a £463,294 tax fraud

Sheffield Crown Court heard on October 3 how company director Ian Gibson, aged 62, of Riverdale Road, near Endcliffe Park, Sheffield, ran a company called IGM Projects Ltd and latterly IG Management Ltd when he perpetrated six offences relating to tax fraud over ten years from 2009.

Prosecuting barrister James Lake said: “The defendant committed what The Crown says was a persistent and sustained attack on the tax system.”

The court heard Gibson’s company provided management services for commercial site developments and properties.

Mr Lake added Gibson evaded VAT by making false declarations of purchases and fabricating invoices, and he failed to declare all of his earnings between 2009 and 2019 to evade Income Tax, Corporation Tax and company charge liability by falsifying the turnover of his business.

Gibson also extricated money which affected the PAYE system, according to Mr Lake, and the total owed to the HMRC as a result of the defendant’s fraudulent activity reached £463,294 which he pocketed.

HMRC visited the defendant in July, 2018, to inspect his company records and after talking to Gibson’s suppliers 140 invoices were confirmed to be false, according to Mr Lake.

Mr Lake added that bank records showed that income paid to the two companies never went into the business accounts but had been paid into Gibson’s own personal accounts.

Judge David Dixon said: “It’s plainly fraudulent activity sustained over a significant period of time. One does not fall into falsifying invoices over a number of years.”

However, Judge Dixon conceded Gibson’s further continued offending was likened to “robbing Peter to pay Paul”.

Gibson, who has no previous convictions, pleaded guilty to VAT and Income Tax fraud, and to dishonestly failing to disclose information in relation to Corporation Tax all amounting to six counts of fraud.

He admitted: evading VAT by making false declarations of purchases on VAT returns by fabricating invoices; evading tax regarding Income Tax, Corporation Tax and company charge liability by falsifying the turnover of his business to reduce tax liability; and subsequently interfering with the PAYE system.

Defence barrister Ian West said Gibson had been caught out by the 2008/9 financial crash and the banks called in his loans and overdraft withdrawing his financial facility and without the funds he began “robbing Peter to pay Paul”.

The defendant took the view he needed working capital to advance projects in the hope of turning profit, according to Mr West, and to do so he would have to pay funds into a separate account.

Mr West added the defendant’s sole intention was to recover his losses and therefore satisfy his creditors including HMRC as he worked on a project from 2014 changing an industrial site into a residential site but there were delays, planning refusals, and obstacles.

Judge Dixon told Gibson: “In short, over a ten year period, you have defrauded the revenue of just shy of half-a-million pounds.”

He added: “In 2009, when there had been a crash of sorts it was well known the impact of losing half-a-million would have had on the Exchequer. Today, with the cost of living crisis – as it has been labelled in the press – just imagine what half-a-million pounds could do?”

Judge Dixon sentenced Gibson to 64 months of custody and disqualified him from being a company director for eight years.

Following the hearing, Timothy Atkins, HMRC Fraud Investigation Service operation leader, said: “This was a deliberate attempt to pocket hundreds of thousands of pounds in taxpayers’ money which should have been used to fund our vital public services.

“We will continue to pursue the small minority who think tax fraud is acceptable."

Proceeds of Crime Act confiscation proceedings are underway to recover the stolen money, according to the court.

Specialist Prosecutor Ben Reid added: “Ian Gibson deprived the taxpayer of more than £400,000 by evading both corporate and personal tax liabilities. He did so by dishonestly failing to declare his true income and falsifying invoices in his VAT returns.”

HMRC has urged anyone with information about tax fraud to search “Report Fraud HMRC” online on GOV.UK and complete the available form.