Head of Auckland furniture-making business sentenced to home detention for tax fraud

Inland Revenue says it warned Maha Nand Sami Naidu about the serious consequences if he didn't comply with his tax obligations. Photo / 123RF

The owner of a furniture-making company committed a “crime against the community” with a tax fraud that resulted in up to 30 workers being denied their KiwiSaver contributions, Inland Revenue has said.

Maha Nand Sami Naidu was sentenced in the Manukau District Court this month to 11 months’ home detention for trying to avoid paying $321,772 in GST and deducting $373,483 in tax from his workers’ wages but not passing it on to Inland Revenue (IR).

Naidu was the sole director of Kitchen Building and Fitting, a furniture-making company he started in September 2013, according to a statement released by IR today.

It said Naidu “always showed very poor compliance” with his tax obligations and that the department had tried to help. It had talked to him about large amounts of tax owed and the large number of returns not filed.

He was warned several times about the serious criminal and civil penalties that could result if he did not comply with his obligations.

The department said Naidu did not file GST returns from 2019 to 2021 and tried to evade $321,772 in GST payments.

Between August 2019 and May 2021, he also deducted $373,483 in PAYE from employees’ wages but didn’t pass it on to IR as required.

According to IR, the sentencing judge said Naidu’s tax offending was a crime against the community and meant that 20 or 30 people he employed missed out on their KiwiSaver contributions because of what he did.

His sentence included six months of post-detention conditions, including that he undertake budgeting advice.

A search of the NZ Companies register showed Naidu was currently a director and former shareholder in joinery and cabinet-making business ABMN, which had a registered office in Waiuku.

The company was registered in 2021 and last filed an annual return in October last year.

He was listed as having been removed as a director and shareholder of Papatoetoe-based finance and investment company Dosti Group and was removed as a director and shareholder in Auckland-based catering company Joy Catering Services.

Tracy Neal is a Nelson-based Open Justice reporter at NZME. She was previously RNZ’s regional reporter in Nelson-Marlborough and has covered general news, including court and local government for the Nelson Mail.