Employees left with unpaid KiwiSaver contributions worth over $100,000
The company director of an Auckland-based firm has been sentenced to two years and three months in jail for not paying employees' taxes to the Inland Revenue Department (IR).
David John Gower was the company director of AFS Total Fire Protection Ltd (AFS), a firm specialising in installing and maintaining fire and emergency systems.
The company had about 80 employees before it was liquidated at the end of 2016.
According to the IR, the firm owed $108,305 in unpaid KiwiSaver Employer Contributions and $40,869in unpaid Employer Superannuation Contribution Tax by the time of its liquidation.
"AFS's workers never got the benefit of that money or any interest on it," the department said in a media release.
The company's liquidation was initially held off to give Gower the chance to stick to a plan for repayments, but none of the plans stuck.
"Despite repeated attempts to contact Gower, and warnings, the offending continued for 17 months after a final warning letter in May 2015," the IRD said.
Gower pleads guilty
Gower was charged with aiding and abetting AFS in deducting PAYE, KiwiSaver Employer deductions, student loan employer deductions, and child support from employees' wages but never passing them to the IR.
He pleaded guilty a week into the jury trial to a representative charge, covering 49 tax periods.
Gower, who had been a director of 20 companies since 1989, also said he was aware of his obligations as an employer.
"Prosecutors told the jury that carrying on a business without paying taxes is unfair to employees, unfair to other businesses, and unfair to other taxpayers," the IRD said.
In addition to getting jail time, Gower also repaid $300,000 in reparation.