Dunedin company director jailed for evading $560,000 in PAYE, his second conviction

A Dunedin company director has been jailed after being convicted for a second time for failure to pay PAYE.

Leslie John McKenzie plead guilty to 48 charges of aiding and abetting his three companies to deduct tax from workers’ wages, which were never passed on to Inland Revenue.

He was sentenced to two and a half years’ jail when he appeared in the Dunedin District Court on February 13.

McKenzie was convicted in 2016 for identical offending involving PAYE of $333,470. He was sentenced to nine months’ home detention for that offending.

The most recent offending started soon after that sentence ended and involved three companies: Clickworks Design Limited, Clickworks Manufacturing Limited, and Moduletec Limited.

The total unpaid to IR this time is $560,000.

The court was told the three companies were put into liquidation in 2022 and 2023. The liquidators are still pursuing recovery options, but recovery appears unlikely.

The failure to account for PAYE deductions occurred over a four-year period and was premeditated and deliberate. It was not a one-off lapse.

When Clickworks Manufacturing Limited and Clickworks Design Limited were liquidated, McKenzie carried on offending using a new company until it too was liquidated by the Commissioner. The amount of PAYE unpaid was substantial.

His use of the tax money as working capital and personal income gave McKenzie a competitive and lifestyle advantage over other taxpayers who paid their tax. The seriousness of the offending made a prison sentence inevitable, even with a discount for early guilty pleas.

McKenzie is an undischarged bankrupt.