Sultan Khan, whose father ran a disreputable airport parking business, has been sentenced for evading £233,338.25 in VAT. Khan pleaded guilty in May this year to one count of being knowingly concerned in the fraudulent evasion of VAT, contrary to section 72(1) of the Value Added Tax Act 1994.
Court documents state that between November 1 2014 and June 30 2018, Khan was knowingly concerned in, or took steps with a view to, fraudulently evading VAT by failing to register his car parking business for VAT, despite knowing that its turnover had exceeded the compulsory registration threshold.
Single continuous business
Earlier this month, prosecutor Denise Fitzpatrick told Minshull Street Crown Court that Khan traded under the name 'Car Park Manchester', and the business operated through a succession of three limited companies, all incorporated and solely owned and directed by Khan. These were Nice with Rice Ltd, from 22 April 2014 to 16 August 2016; Eat Meet and Greet Ltd, from 8 October 2015 to 14 March 2017; and Manchester Meet and Greet Ltd, from 17 August 2017 onwards.
The court heard that evidence from the website and customer payment methods demonstrated that despite the changing corporate names, this was a single continuous business. The taxable turnover of Car Park Manchester during the three year period was £1,400,029.52, and so exceeded the VAT threshold for mandatory registration on September 11 2014.
Khan was the applicant and operator of the Merchant Acquirer accounts (Worldpay and American Express) used to process sales for all companies linked to Car Park Manchester, and these accounts were registered to him personally. He was also a signatory to all bank accounts used to receive payments from the Merchant Acquirer accounts, which demonstrated his knowledge and control of the business's turnover, including at the point it exceeded the VAT threshold, the prosecutor said.
Withheld information
"Khan was consequently in control of the bank, Worldpay and American Express accounts associated with the website," Ms Fitzpatrick said. Therefore, Khan was said to be the responsible person for the VAT obligations of Car Park Manchester and its associated companies.
During a compliance check prior to the criminal investigation, Khan told HMRC civil officers that he was responsible for the operation of Car Park Manchester and gave details of how the business operated. However, when HMRC officers requested banking and Merchant Acquirer account information, Khan did not disclose this material, specifically withholding the Merchant Acquirer account information, the court heard.
The turnover contained in the withheld Merchant Acquirer accounts totalled £1,046,939.34, of which £935,027.99 was subject to VAT. As a result, £233,338.25 of VAT was fraudulently evaded.
Sentence and family history
Khan, of Davenport Green Hall, Shay Lane, Hale Barns, Altrincham, was sentenced to 28 months imprisonment suspended for 20 months, along with an electronically monitored curfew and 180 hours unpaid work, on September 4.
Edwige Hill, Deputy Director in HMRC’s Fraud Investigation Service, said: "Sultan Khan deliberately concealed the true scale of his business to avoid paying the VAT he knew he owed. He used a web of companies to mask what was in reality a single, continuous operation. This case sends a clear warning to others that if you deliberately hide your turnover to evade VAT, we will investigate, and you will face justice."
Khan, his dad Mohammed Isaq, and sister Amani Khan, previously ran an unscrupulous 'meet and greet' parking business at Manchester Airport. In 2023 they were hauled before the courts after hundreds of holidaymakers had their cars damaged or stolen. Isaq, 66, and Sultan Khan, 31, and Amani Khan, 30, ran the businesses which 'misled' members of the public, promising 'safe and secure' parking whilst they flew from the airport.
However, after handing over the keys to the company, many were lost, stolen or found damaged in a muddy field on their return. In one case, a man returned from his holiday to find his car had done an extra 688 miles on the clock. Another car was discovered to have cannabis and Rizla papers. Other cars had damage to the alloys, windscreen and body work.
Appearing at Manchester Crown Court in 2023, Isaq was jailed for 17 months, whereas his son and daughter were handed community orders.
