TWO brothers have been jailed after pleading guilty to tax fraud.

Thomas Barnes (44) of Hawkstone Avenue, Whitefield, was given a 15 months sentence and his brother Brian (42) of Heathlands Drive, Prestwich, was jailed for six months.

Bolton Crown Court was told on Tuesday (Sept 9) how both brothers were directors of the thriving Thomas Barnes and Sons building and civil engineering company based at Wellington House, Wellington Street, Bury.

Mr Bernard Lever, prosecuting, said both men had avoided tax payments by generating bogus invoices for goods and services to be set against tax liabilities.

Charges against Brian Barnes involved converting a cottage into a luxury home with a swimming pool and five-a-side football pitch.

Their counsel, Anthony Rumbelow QC, said the brothers had started in business with a small DIY shop 15 years ago which had grown into a sub-contracting company turning over £12 million a year and employing 300 people.

He said the company's accounting procedures had not kept pace with its growth and there had been problems with a previous company accountant who had been "both incompetent and dishonest".

Mr Lever said the case against Thomas Barnes was that he had paid cash bonuses to employees and had given them statements to the effect that income tax had been paid on the bonus accounts.

Bogus invoices were generated by Barnes to set against the tax due from the bonus scheme.

Lost to the revenue from the fraud was "an agreed sum" of £54,163 during a period between February 1990 and March 1993.

Mr Lever said the charges against Brian Barnes related to a former cottage at Chorley which he was converting into a luxury home with swimming pool, five-a-side football pitch and a luxury kitchen among other amenities.

Work valued at £110,000 was done on the property by company employees and the firm should have received payment for this work from Mr Barnes as a private individual.

In fact, £35,000 was not paid until after the Inland Revneue investigators raided the firm in November 1994 and payment for work done at Chorley had been wrongly attributed to company projects in other parts of the country. Mr Lever said the ruse evaded payment of £17,500 tax. Brian Barnes told the investigators he had disguised the location of the work because he did not want office staff to know how much he was spending on his luxury house.

Mr Rumbelow said Thomas Barnes had not received any personal benefit from the bonus deception.

In the case of Brian Barnes, he said the action had been taken to defer payment rather than avoiding it completely.

Company accountant James O'Brien testified that Brian Barnes had pointed out to him that invoices for work on his home had been attributed to other locations, before the Inland Revenue raided the firm.

It was intended that Brian Barnes would at some time regularise the accounts, he said.

Passing sentence, Recorder Geoffrey Tattersall QC, told the brothers: "In your situation, most people would have been happy with their lot, but you were not satisified."

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