Martin Baker was the sole director of C.J.M Tiling Limited (CJMT), which was incorporated in 2007 and traded as a construction company in Cradley Heath, West Midlands.
On 3 December 2015 and 4 March 2016, HMRC made unannounced visits to CJMT and identified the construction company had under-declared its VAT liabilities by failing to disclose all its sales.
Furthermore, an additional bank account was identified in which sales income was deposited. HMRC raised an officer’s assessment for additional VAT liabilities of £205,262 for the period June 2012 to December 2015, as well as applying civil penalties of £90,146 to the company.
CJMT later entered liquidation on 26 January 2017 owing £469,673 to creditors, including at least £344,221 for VAT, and following the company’s liquidation, the Insolvency Service carried out its own investigations, leading to Martin Baker’s disqualification.
On 21 May 2018, the Secretary of State for Business, Energy & Industrial Strategy accepted a disqualification undertaking from, Martin Baker, effective from 11 June 2018, for a period of 7 years.
In giving the undertaking, Martin Baker admitted that he failed to ensure the company declared its true VAT liabilities on returns submitted to HMRC between June 2012 to December 2015, by failing to disclose all its sales.
Martin Baker further admitted that a second company bank account was not disclosed to HMRC. This resulted in under-declarations of VAT due, as a consequence of which penalties were raised.
His ban means Martin Baker cannot promote, manage, or be a director of a limited company.
Commenting on the disqualification, Jane Knight, deputy head of insolvency investigations for the Insolvency Service, said:
Under-declaration of the VAT due by a company deprives the exchequer of the monies needed to provide public services.
In co-operation with HMRC, the Insolvency Service will not hesitate to investigate such misconduct with disqualification as a director the likely outcome.
Notes to editors
C.J.M Tiling Limited (Company Reg No. 06318407) was incorporated on 19 July 2007 and traded from 213 Halesowen Road, Cradley Heath, West Midlands, B64 6HE. Martin Baker was appointed as a director from 19 July 2007 to 26 January 2017, the date of liquidation.
Martin Baker is of Oldbury, in the West Midlands and his date of birth is April 1968.
The matters of unfitness, which Mr Baker did not dispute in his disqualification undertaking, were that:
I failed to ensure that C.J.M. Tiling Limited (CJM) declared its true Value Added Tax (VAT) liabilities on returns submitted to HM Revenue and Customs (HMRC) between the quarters ended 30th June 2012 to 31st December 2015, by failing to disclose all its sales. In addition a second bank account was not disclosed to HMRC. This resulted in under-declarations of VAT due over this period of at least £205,262 and as a consequence penalties of £90,146 were raised.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Persons subject to a disqualification order are bound by a range of other restrictions.
The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
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Link: Press release: Construction director banned for failing to declare sales income
Source: Gov Press Releases
