A man who builds homes will now be detained in one for a year. Photo / NZME
A man who builds homes will now be detained in one for a year. Photo / NZME
An Auckland man who evaded more than $340,000 in taxes from building work has been sentenced to home detention for a year.
Kahdim Ali was sentenced in the Manukau District Court on October 4 after pleading guilty to 35 charges including evading or attempting to evade the assessment or paymentof personal income tax, GST as well as income tax and GST of his company.
Inland Revenue (IRD) began investigating Ali’s tax affairs after it became known in a related investigation that he was receiving large sums of cash from clients in the building industry but wasn’t declaring that money in tax returns.
The investigation was extended to include the tax affairs of his company A1 Projects Limited (A1).
Ali was found to have evaded $348,546.96 in total taxes, which included personal income tax ($212,581.70); personal GST ($78,404.23); A1′s income tax ($30,022.95); and A1′s GST ($27,538.08).
The IRD said Ali used a tax agent for all his personal and business tax returns and in 2009, 2010 and 2013 declared nil income. Income declared for 2011 and 2012 was only PAYE based salary and in 2014 and 2015 the returns show only shareholder salary received from A1.
Ali claimed he provided his tax agent with the bank account to include the income in tax returns and also claimed he had provided the tax agent with all supplier invoices, however, both claims turned out to be false.
Ali only provided his agent with A1′s bank account statements for the completion of all tax returns, when in fact the majority of income was being deposited into a personal bank account, the IRD said.
This resulted in false income tax and GST returns being filed for A1, as well as false personal income tax returns.
He also did not file any personal GST returns despite collecting a substantial amount of GST through his building contracts.
The debt has since been paid off.
In 2019, Ali was adjudged bankrupt and in 2023 the Official Assignee paid Inland Revenue $210,000 of the debt. The remaining unrecovered tax shortfall of $135,073 was paid in full by Ali a week before sentencing.
Ali was also sentenced to 200 hours community work.
