Wellington
accounting firm Accountants First Ltd has been removed from the list of Inland
Revenue approved tax agents after convictions for tax evasion.
Owned by Mr Imran
Kamal and his wife, Accountants First has been in business since 2005. The High Court was told that through
2006-2008 Mr Kamal was implicated in a tax scheme involving use of false
invoices raised for non-existence IT services.
These invoices were used to support fraudulent GST claims. The fraud came to light following criminal
prosecutions against promoters of the false invoicing scheme: a Mr Anderson and
a Mr Gilchrist.
In December 2011, ten
months after Inland Revenue had commenced a tax investigation into both Accountants
First and Mr Kamal, he elected to make a voluntary disclosure to Inland Revenue,
arranging to repay tax due with interest and penalties. Tax evaded by Accountants First totalled some
$55,700.
In February 2013, Mr
Kamal was sentenced to three months home detention and 150 hours community work
after conviction on six counts of tax evasion.
Accountants First was convicted and discharged.
Accountants First
challenged Inland Revenue’s decision to remove it from the list of approved tax
agents. Status as an approved tax agent
gives considerable commercial advantages to tax accountants. With client approval they have online access
to client information at Inland Revenue.
This speeds up tax work, improving business efficiency. Evidence was
given that Accountants First currently employs up to ten staff and handles
about 1100 clients.
Justice Collins ruled
that Inland Revenue followed the correct procedure: it had provided reasons and
it had given Accountants First a chance to respond.
Inland Revenue said
convictions for tax evasion were evidence of behaviour that undermined the
integrity of the tax system. Retaining
Accountants First on the list of approved tax agents would undermine confidence
in the system.
Pleas by Mr Kamal that
he was remorseful and would be unlikely to offend again were prejudiced by his later
behaviour when seeking name suppression on grounds that publicity would affect
his wife’s health. Evidence was given
that Mr Kamal filed an affidavit stating that his wife was taken by ambulance
to hospital following an overdose of sleeping pills. Inquiries revealed there was no evidence of
Mrs Kamal being at the hospital on the day in question. When challenged, Mr Kamal stated he had taken
his wife to the hospital, but they left without seeing anyone.
Accountants
First Ltd v. Inland Revenue – High Court (6.10.14)
14.045