A COUNTY painter and decorator swindled the taxpayer out of tens of thousands of pounds by failing to register his VAT.

Kenneth Wheatley failed to hand over £46,868.84 to HMRC after he cancelled his account and informed them his Interiors Plus business would be trading below the VAT threshold.

But the self-employed North Berwick business owner continued to trade profitably and began cashing his payment cheques at a money bureau in a bid to avoid paying the tax bill.

The decorator, of Market Place, cashed cheques for work he had carried out worth close to £300,000 at cheque cashing firm ClearACheque at Edinburgh’s Tollcross area over a four-year period.

But the 50-year-old was caught swindling the taxpayer after police raided the cheque cashing business on a separate matter and uncovered paperwork relating to Wheatley’s deception.

Last Thursday, Edinburgh Sheriff Court heard that Wheatley had run his VAT-registered business from 1996 but cancelled his HMRC account in 2010 as “his practical turnover would be below the threshold for VAT”.

Fiscal depute Ann McNeill told the court: “In a separate unrelated enquiry, police were executing warrants for a company called ClearACheque and through this investigation HMRC obtained documents and it became clear the accused was still trading as Interiors Plus.

“One-hundred-and-eight transactions were identified, totalling £289,000, and using this information the police got a warrant for the accused’s home address and it was searched.

“It became clear the accused had been trading and that the VAT should have been paid – the sum £46,868.84 had been evaded.”

Defending solicitor David Allan told the court that Wheatley had tried to negotiate repaying the money to HMRC but after sending a cheque for £500 he heard nothing back and the cheque was not cashed.

Mr Allan said: “What he has done since is that he has £36,000 available to repay immediately and continues to work at the painting and decorating business.

“He is busy and now employs two others. The balance of around £10,000 could be repaid at £1,000 per month.”

Sheriff Frank Crowe said: “Now that a conviction has been recorded I don’t think HMRC will be coy about receiving any money.

“I will defer sentence for reports but in the meantime you should take steps to pay as much as you can to HMRC and we will see what the score is at that point.”

Sentence was deferred to next month for reports and a restriction of liberty assessment to be carried out.

Wheatley admitted to fraudulently evading VAT amounting to £46,868.84 by using the services of money service bureaus to cash cheques payable to himself and failing to submit returns to HMRC between July 1, 2012, and April 14, 2014.