Five jailed in £4.3m diesel and VAT fraud

A gang that included a town Councillor and a pensioner has been jailed for a total of 19 years for evading an estimated £4.3m in duty and tax through fuel and VAT fraud.

In short, they used their connections to a farmers’ buying consortium to order large quantities of rebated fuel, commonly known as red diesel, according to HMRC. The fuel was sold to haulage firms, and they went as far as fitting anti-syphon tanks to lorries to avoid detection.

It is estimated that around 1.5m litres of rebated fuel was used illegally with an estimated duty loss of £672,000.

As we always forewarn clients, once you’ve attracted HMRC’s attention, they continue to dig… and in this case, all their misdeeds were discovered.

… the hauliers weren’t handing over the VAT on the sales
… the company didn’t pay the right corporation tax
… the drivers should have been treated as employees and instead, were made to look like self-employed.

Another £3.7m was discovered.

Jo Tyler, assistant director, criminal investigation at HMRC said: “This criminal gang manipulated a system put in place for the legitimate use of red diesel, giving them an advantage over honest hauliers. They then charged their customers VAT which they kept instead of paying to HMRC. They knew that they were breaking the law, yet chose to overlook it for the opportunity of making what they wrongly assumed would be easy money at the expense of the UK taxpayer.”