TC09659 - [2025] UKFTT 01211 (TC)

Fecha: 18-Sep-2025

SKM’s Business – control

SKM’s Business – control

40.

The extent of KG and SF’s respective control over SKM’s activities was of importance in determining if SF was liable to the PLN. Broadly HMRC’s argument was that SK was the controlling mind, whereas on behalf of SF Miss Brown argued that, if SKM knew or should have known about its transactions with BTL being connected to fraud, then this was attributable either entirely or predominantly to the actions or inactions of KG.

41.

We accepted as fact KG’s evidence that:

(1)

his role was principally to provide funds;

(2)

he was not a director of SKM because he was subject to a restriction arising from the sale of his FX business;

(3)

during this period of restriction, he was “bored”, had little to do, and felt an obligation to his “partner” (i.e. SF); therefore in practice KG spent up to four days a week physically helping in the scrap yard;

(4)

he did not have any powers over the bank accounts although SF would ask KG whether he thought certain payments should be made;

(5)

his role was at most a limited power of veto (because “it was my money”) rather than a power to actively control the business.

42.

SF’s evidence was that KG was actively involved on a day to day basis and that some decisions were made in discussion with KG because it was “Kane’s money”. SF asserted that KG was a shadow director.

43.

We did not accept SF’s assertion that KG was a shadow director, that being a question of law.

44.

We preferred KG’s evidence as to his role, that being consistent with the documentary evidence (e.g. SF was the sole director, SF was the person who had interactions with HMRC). It was also more consistent with the overall picture we heard from KG and SF’s respective witness evidence.

45.

Accordingly, we found as a fact that SF had operational control of SKM and was responsible for the business activities.