A Christchurch man who deducted PAYE from his workers’ wages but failed to hand it over to Inland Revenue has been sentenced to 10 months home detention.
Frederick Mario Mau Epiha pleaded guilty to 16 charges of aiding and abetting a company he set up to knowingly apply PAYE deductions. He was sentenced in the Christchurch District Court on 30 September.
The court heard Epiha engaged in “phoenix type behaviours.” Before setting up Redemption Solutions Ltd (RSL) in May 2022, he worked as a manager for Asia Pacific Group Limited (APG).
Epiha incorporated RSL to take over APG’s business despite knowing of APG’s significant tax arrears. The new company continued to operate in the same non-compliant manner.
In 2024, APG’s director Melanie Tatana was sentenced to three years’ imprisonment for aiding and abetting the company in failing to account for more than $1.6 million in PAYE.
As sole director of RSL from October 2022, Epiha was responsible for the company’s tax compliance. The court was told RSL was non-compliant from the outset and went into voluntary liquidation in April 2023.
Between August 2022 and April 2023, the company failed to pay $215,043.24 in PAYE deductions.
The court was told the real victims are New Zealand taxpayers, with offending of this kind posing a serious threat to the integrity of the tax system.
It also creates an unfair financial advantage over law-abiding businesses, potentially encouraging others in the industry to follow suit in order to compete.
The PAYE offending was described as deliberate, premeditated, and repeated. Epiha continued the behaviour despite warnings from Inland Revenue and confirmed that he knew failing to pay employees’ PAYE was a criminal offence.
