A lawyer’s long tale of bad luck failed to win him a legal challenge against penalties for investing in film partnership tax avoidance scheme.
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Solicitor Joginder Nijjar’s tale of woe started in 2008 when he filed a self-assessment tax return that was investigated by HM Revenue and Customs.
In the same year, he lost hundreds of thousands of pounds as the result of a fraud at his legal firm, the First-Tier Tax Tribunal heard.
Nijjar also told the tribunal that he suffered heart problems in 2012 leaving him in poor health and unable to work following a triple by-pass operation.
He argued that the fraud and his health were special circumstances that contributed to him failing to pay a £61,676 accelerated payment notice for tax HMRC alleged he had avoided by investing in the film partnership.
Legal challenge
Nijjar was also appealing the notice and penalties because HMRC had not properly calculated and issued the notice and that as he had not benefitted from any cash flow advantage from investing in the film partnership.
The tribunal rejected his appeal on all grounds.
The judge stated: “Mr Nijjar is clearly an intelligent man and a qualified solicitor. He should have realised that the issue of the notice meant that he would owe HMRC money and that the onus was on him, as a debtor, to get in touch with HMRC before the due date for payment to agree an instalment plan.”
The tribunal also ruled his ill-health was not a special circumstance and had not prevented him from paying the notice.
Lawyer jailed
Meanwhile, in a separate case, another lawyer was jailed for 18 months at Harrow Crown Court, North London, after he was found guilty of a £60,000 tax fraud.
Azhar Islam Khan, from London, was accused of failing to tell HMRC about dividend income and rents from two buy to let homes in Preston and Blackburn.
He disguised the income by pretending private spending on a new kitchen and bathroom in his home were business expenses.
Besides the prison sentence, Khan was barred from holding a directorship for four years.
HMRC has also started action to confiscate the money involved.
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