Indian-origin businessman banned over false tax returns in Britain

A Scotland-based Indian-origin construction firm boss has been banned from running companies for at least nine years for submitting false tax returns to British authorities.

Hardip Singh Khaira, from Coatbridge in North Lanarkshire, will be disqualified for nine years starting Thursday, after which the 43-year-old is banned from acting as a director or directly or indirectly becoming involved, without the permission of the court, in the promotion, formation or management of a company.

It was clear from our investigations that Hardip Khaira deliberately caused the construction firm to submit false returns to reduce the amount of tax the company had to pay, said Robert Clarke, the Chief Investigator for the UK's Insolvency Service.

This is serious misconduct and a nine-year ban not only demonstrates the severity of what Hardip Khaira has done but also confirms that we will take action to remove the privilege of limited liability against those who think they can do the same, he said.

Khaira's HK Construction was incorporated in May 2011 and traded from premises in Coatbridge until July last year, providing groundwork construction services.

In September 2019, the construction firm was subject to a Creditors Voluntary Liquidation and this brought HK Construction to the attention of the Insolvency Service. Investigators uncovered that between November 2011 and February 2015, Khaira knowingly caused the company to submit false tax returns.

Some invoices had been brought down to zero rated sales to reduce the company's tax liability, the Insolvency Service said.

The UK tax authorities determined that just over 225,000 pounds were owed by HK Construction, which increased to more than 426,000 pounds when interest and penalties were applied for "deliberate concealment and failure to pay".

The Insolvency Service said that aware of the liability owed to the tax authorities, Khaira placed the company into Creditors Voluntary Liquidation, resulting in outstanding liabilities to the UK tax authorities of more than 426,000 pounds.

Last month, the government accepted a disqualification undertaking from Khaira after he did not dispute concealing tax to the detriment of the tax authorities.

A voluntary undertaking 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 or be a receiver of a company's property.

In the UK, disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.