Wick fisherman 'buried his head in the sand' over tax bill
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A CAITHNESS fisherman who admitted tax evasion of £42,500 was thrown a lifeline by a sheriff this week.
Tony McPhee avoided jail and was given three years in which to pay off the tax bill.
In addition, the 33-year-old was ordered to carry out 225 hours of unpaid community work.
McPhee was said to have "buried his head in the sand" in respect of the tax bill.
Wick Sheriff Court heard that he had been in the habit of making self-assessment returns to HMRC as a share fisherman and had been putting cash by in a special bank account to meet his obligations.
However, he lost control of his finances by dipping into his tax fund for spending money and made no returns for a period between April 2011 and April 2017.
McPhee worked for years without paying what was correct and stole the equivalent of two ambulance technicians’ salaries.
McPhee admitted a charge of fraud. A plea of not guilty to a charge of failing to pay national insurance contributions over the same period was accepted by fiscal David Barclay.
Solicitor Fiona MacDonald outlined efforts made by McPhee, of Harrow Terrace, Wick, to repay the outstanding tax and a payment arrangement imposed by HMRC.
She said that to date the accused had paid a total of £15,627 and was willing to make further payments as and when he could. However, a repayment schedule of £6000 a month had been fixed and McPhee said he wasn't able to service this given his earnings.
Miss MacDonald said that McPhee had indicated he could manage £800 a month but that wasn't acceptable to the taxman who described it as "too low".
Miss MacDonald said that after deducting payments already made by McPhee there was £42,500 still outstanding. At the rate of £800 a month amounting to over £9000 per year the capital sum would be paid off in three years, although that didn't include interest.
Miss MacDonald appealed to Sheriff Andrew Berry to "step back" from a custodial sentence and consider instead community service, saying that McPhee was trying to rectify matters. He had declined offers of financial help from friends.
Sentencing McPhee, Sheriff Berry noted that he was a first offender and had accepted responsibility but made the point that the sum owed was a significant amount of taxpayers' money.
The sheriff continued: "I have to consider whether there is an alternative to custody and by a very thin margin I am persuaded I can deal with this matter without sending you to prison – but only just."
Sheriff Berry adopted the pattern of repayment suggested by Miss MacDonald and made a compensation order for the monthly instalments of £800 in order to clear the debt in three years, during which he will be under supervision.
McPhee will regularly have to provide proof of the payments and will require to advise the court when he is not at sea and not able to maintain them.
Sheriff Berry noted that he rightly had no control of any steps HMRC might take in the civil court and added: "At least this court has put something in place and I am able to deal with this matter that will give some confidence that what has been taken from the public purse will be repaid."
Joe Hendry, assistant director with HMRC’s Fraud Investigation Service, said: “The vast majority of those working in the Scottish fishing industry are law-abiding people paying their taxes to fund public services.
“McPhee wasn’t one of them – working for years without paying what was correct and stole the equivalent of two ambulance technicians’ salaries. If you know of anyone who is committing tax fraud you can report them by calling our Fraud Hotline on 0800 788 887.”
