Property developer sentenced to home detention – tax evasion

Press Release – Inland Revenue Department

A Palmerton North-based property developer was sentenced to eight months home detention, 250 hours community service and ordered to pay $10,000 in reparations for GST and income tax offences in the Wellington District Court today.23 March 2012

Property developer sentenced to home detention for tax evasion

A Palmerton North-based property developer was sentenced to eight months home detention, 250 hours community service and ordered to pay $10,000 in reparations for GST and income tax offences in the Wellington District Court today.

Colin Graham Campbell, also known as Graham Campbell, had been found guilty on seven charges related to tax evasion and failure to file Income Tax and GST returns. The loss to Inland Revenue excluding interest and penalties was approximately $225,000.

Group Manager Assurance, Patrick Goggin, said Campbell used his businesses to buy and sell property yet he deliberately evaded his tax obligations.

“In 2005, Onslow Construction Limited received project management fees of $260,000 relating to a sale of properties in Paraparaumu. Campbell is sole director of this company and the money was paid directly into bank accounts under his control.

“Onslow Construction filed false GST returns and Income Tax returns during 2005 and 2006 failing to return the fees received. Neither the company’s GST debt of $29,000 nor outstanding the Income Tax debt of $76,266 have been paid to Inland Revenue.

“In December 2006, Campbell entered into separate property transactions through the Falkirk Trust, which he controlled through GM Trustees Limited. The trust purchased 41 acres of land in Ohau, just south of Levin, which it subsequently sold in five lots, including selling two lots of land to a related entity called Cloud Trust. The trustees failed on behalf of the Falkirk Trust to file the required GST returns.

Inland Revenue issued default GST assessments of almost $120,000 in April 2009 regarding these transactions and this amount is outstanding.

“Inland Revenue has been funded to target non-compliance relating to earnings from property as part of its compliance programme as income may be taxable and must be declared. We have a system in place that alerts us when property is transferred to ensure everyone pays their fair share.

“It was Campbell’s responsibility, as a director of his trading and trustee companies, to be fully aware of the tax rules and ensure that they were compliant. He was not only cheating taxpayers, but gained an unfair advantage over others in the property sector that played by the rules.” Mr Goggin said.

ENDS

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