Fraudulent Sheffield businessman is spared from jail after he dodged paying over £414,000 in taxes

Sheffield Crown Court heard on February 21 how Darren Johnston, aged 45, of Abbey Lane, Sheffield, pleaded guilty to 12 offences relating to his telecommunication companies between 2011 and 2015.

Judge Michael Slater told Johnston: “You fall to be sentenced for a number of offences in respect of your dishonest conduct against Her Majesty’s Revenue and Customs between 2011 and 2015 which culminated in a benefit to you of over just £414,000.”

But Judge Slater also told Johnston it was to his credit that he has since paid all the money he owed in various taxes to the HMRC after he had illegally avoided paying them at the time they were due.

Judge Slater added: “I accept you ran the companies otherwise legitimately other than the offences you committed. The fact that you paid back the entire sum is in my view an extremely significant point.”

Prosecuting barrister Christopher Moran explained Johnston was responsible for: two counts relating to failing to submit tax returns; four relating to providing fraudulent false documents to avoid VAT liability by producing false invoices and presenting low sales figures; three of making false statements in relation to avoiding paying corporation tax; and three of evading income tax. He added the total loss to the HMRC was £414,756.08p.

Johnston, who has no previous convictions, pleaded guilty to: two counts of fraudulent evasion of income tax; four counts of furnishing false documents in relation to VAT; three counts of making a false statement with intent to defraud; and three counts of being concerned in the fraudulent evasion of income tax reflecting annual income tax self-assessment.

Mr Moran said the offending happened while the defendant was involved in the telecommunications business including Sheffield-based company Georgia Telecommunications Ltd and he would have known about having to deal with PAYE, self-assessment, income tax and VAT matters.

Concerning ten of the counts over about 18 months, defence barrister Kevin Hegarty said: “The whole essence of all these counts arises from the creation of false invoices which in turn corrupted VAT figures, corrupted corporation tax figures and the income tax figure.

"Everything stems from these counts concerning the creation of false invoices from January, 2013 to July, 2014.”

Mr Hegarty described the offending as a “home made creation” that had not involved lawyers and accountants and it has become a “real black mark” against Mr Johnston’s career.

He added that there was no way this would not have all come to light because accountants could see the difference between what was going in and what was going out.

Mr Hegarty said father-of-two Johnston suffers with a vascular malformation and his offending has played a part in the breakdown of his marriage and he has expressed genuine remorse.

Judge Slater acknowledged a probation service report which highlighted Johnston has been overwhelmed with guilt and shame and suffers with poor physical health and depression.

He sentenced Johnston to 18 months of custody suspended for two years with 200 hours of unpaid work and a Rehabilitation Activity Requirement.

Judge Slater warned if Johnston commits further offences or breaches the suspended sentence in the next two years he would need some persuading not to send him to prison.