A mother and daughter have been sentenced for evading tax of nearly $2m.
Faalaa Fialua was charged with four representative charges of evading the assessment and/or payment of GST and PAYE for two different companies she had run.
Meanwhile her mother, Vaipou Vaoga, faced two of the same charges for one of those companies.
They were both sentenced on April 28 to 12 months home detention and 40 to 50 hours of community work when they appeared in the Waitakere District Court on Tuesday.
Inland Revenue said the first of the two companies, TK-Kovati Limited, was set up in November 2012, with Vaoga and her husband as directors.
The company, which had supplied workers to pick crops, was initially managed by Vaoga – but in 2020 Fialua took over running it.
Vaoga had left New Zealand two days before the country went into the Covid-19 lockdown, and she returned from Samoa in December 2022.
Fialua closed the company in March 2020, but nine days later set up another company to continue the business which had been carried out in an effort to circumvent TK-Kotavi’s tax obligations.
Inland Revenue said between 2018 and 2019, Vaoga evaded the assessment and/or payment of $487,000 in GST, and about $510,000 in PAYE.
While Fialua was in control of TK-Kovati, Inland Revenue said she deliberately evaded the assessment and/or payment of $130,788 in GST and $378,766 in PAYE.
The second company, VAG Son’s Limited was set up in December 2020 by Fialua. Inland Revenue said this company was not tax compliant from the start.
With this company, Fialua had evaded the assessment and/or payment of $132,248 in GST and $236,141 in PAYE.
Over both companies, Inland Revenue said Fialua evaded a combined total of $878,000 in GST and PAYE.
The total evaded by Vaoga was about $997,000.
During sentencing, Judge Singh set a starting point of 45 months for Vaoga, and 42 months for Fialua.
Judge Singh found Fialua’s culpability had been slightly less as it was her mother who brought her into the business, and there would have been family pressure for Fialua to continue it.
Taking into account guilty plea credits and personal factors, such as ill health and disproportionate effects on dependent children, Judge Singh decided to take a merciful approach in sentencing the pair.
He noted if not for these factors, a prison sentence would be the likely result.
Judge Singh said while the amount of the evasion is large, there is no suggestion they lived a lavish lifestyle as a result of the offending.
He accepted the defence suggestion Fialua had set up the second company motivated by being able to continue to pay workers.
However, Judge Singh did not accept Vaoga’s argument she did not understand tax, because she had a number of reminders and warnings from Inland Revenue and simply chose to not prioritise fulfilling the company’s tax obligations.
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