Business Editor for the NZ Herald

Man jailed for false tax return claims

Inland Revenue said the man lost $65,000 as a result of the man's offending.
Inland Revenue said the man lost $65,000 as a result of the man's offending.

A 36-year-old Auckland man has been sentenced to six months' jail for misusing companies to illegally claim tax refunds, Inland Revenue says.

Varunesh Venkat Naidu appeared in the Auckland District Court today for sentencing after being found guilty in July of two charges of aiding and abetting companies to claim tax refunds they weren't entitled to.

He was sentenced by Judge Christopher Field.

The IRD's Patrick Goggin said Naidu deliberately used two companies he directed - Premium Developments and GSMarena - to file false GST refunds in 2010 and 2011.

Naidu used Premium Developments to seek a $206,666 refund in 2010 and changed his story when questioned by IRD, then tried to withdraw the false return and stall the investigation, Goggin said.

"This is a case of someone deliberately misusing companies to illegally claim taxpayer money," Goggin said.

Goggin said that Naidu also used GSMarena Limited to file false GST returns in 2010 and 2011.

"Our audit showed that this company claimed expenses of $579,757 however an examination of its bank statements showed that there was never any such level of business activity.

"As with Premium, he kept changing his story as to why he could not produce the necessary documentation to support these refund claims."

GSAMarena sold mobile devices but stopped trading a year ago, says its liquidator. While the company had use of a 2009 Lexus and computer equipment, the liquidator said it would be uneconomic to chase these assets.

Inland Revenue said Naidu's offending caused it to lose $65,000, much of this used on his personal expenses.

"Naidu's actions were a deliberate attempt to claim money to which he was not entitled simply to. He was fully aware of the rules and that his actions were illegal. He was funding his lifestyle by making false GST refund claims and thereby cheating taxpayers by his actions," Goggin said.

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