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Armagh man loses appeal over £560k tax bill for illegal cigs trade

An Armagh man convicted of involvement in the counterfeit cigarette trade has lost a legal battle over a tax bill of up to £560,000.

John Martin claimed he had discharged any liabilities and that he was on benefits during a seven year period investigated by HM Revenue and Customs.

But judges in the Court of Appeal rejected his case after finding no evidence to back it up.

In 2007 Martin was sentenced to 18 months imprisonment after being found guilty of the fraudulent use of trademarks.

He had been charged after police seized quantities of counterfeit cigarettes during searches at his undisclosed home address and other properties linked to him in 2005.

The total benefit to him from his criminal conduct was assessed as being an amount up to nearly £90,000, the court heard.

A confiscation order was made against him under the Proceeds of Crime Act 2002 (POCA) in the sum of £35,116.

HMRC also launched an investigation into Martin's tax affairs for the period between 2001 and 2008.

During communications with the authority he stated that he only received income during the relevant period.

But despite being asked to produce details of any earnings and property, the court was told no information was supplied.

Martin maintained his stance that the confiscation order discharged any tax liabilities.

Based on an examination of his lifestyle and property holdings, HMRC decided his declared and taxed earnings were insufficient to maintain either.

It assessed him as being liable for £382,687 in income tax, with surcharges and interest bring the total figure to £560,000.

Martin went to the Court of Appeal after two tribunals dismissed his challenge to the assessment.

However, Lord Justice Weir ruled there had been no error of law.

Refusing leave to mount a further appeal, he said: "It may have been that his only income from any source whether legal or illegal for the years covered by the assessments was in fact no more than the amount assessed under the POCA compensation order.

"But once the assessments had been raised it was for the applicant to positively displace them by evidence. This he entirely failed to do."

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