VAT Inspector And Husband Made £1.7M From Secret Tax-Free Buy-To-Let Property Empire

Savita & Naveen Seth

A VAT inspector and her husband deceived mortgage lenders and the taxman while claiming tens of thousands in benefits as they collected rents of £1.2m from their property empire, a court heard today.

Buy-to-let barons Savita, 46, and ex-IT consultant Naveen Seth, 47, rented out twelve properties - often divided into bedsits to maximise profits - while swindling £68,352 in tax credits, the jury were told.

The couple, of Manor Waye, Uxbridge collected another £500,000 during the scam and even rented out three bedsits at the matrimonial home - plus parking spaces in their driveway, Isleworth Crown Court heard.

Police found the book: 'A Guide To Becoming A HMO (Homes of Multiple Occupation) Millionaire' during a raid on their home and discovered they also had a Spanish villa in Malaga, a two-bedroom apartment in Orlando, Florida and a seaside caravan.

They added two commercial properties to their portfolio, bought at auction for £135,000 and £111,000 cash respectively while Naveen had no obvious income and Savita was a £20,000 a year civil servant with Her Majesty's Revenue & Customs (HMRC).

During this period the couple, who have two children, enjoyed holidays in in Spain, USA, Canada, Egypt, Turkey and Morocco.

"They lied about their incomes, they rented out most of the properties and got income, but never told the taxman about that income," explained prosecutor Miss Ailsa Williamson.

"They sold three of them, but did not tell the taxman about the profit they made and the icing on the cake was tax credits they claimed by lying about their income."

The Seth's falsely inflated their incomes to banks and building societies to get mortgages, with Naveen representing himself as a high-earning IT consultant even when claiming Jobseekers Allowance, the jury were told.

"Some of the lies were blatant because he was made redundant in 2002," added Miss Williamson. "What is galling is Savita was working for HMRC as a tax compliance officer specialising in VAT.

"Navita was earning a living running a property company with his wife, but not telling the taxman about it."

As well as their eight-bedroom matrimonial home the couple bought homes in Docklands; Hayes; Uxbridge; Harrow; Hillingdon; Colindale and Bracknell.

The two commercial buildings were in Bingley, North Yorkshire and Cumbria, consisting of a restaurant and takeaway with flats above.

"Savita played an active role in the renting of these properties and they both attempted to purchase many other properties.

"If they were just living on her salary as a VAT inspector they were making it go a very long way."

The court heard the couple deliberately avoided employing letting agents who deducted tax and investigators calculated their rental income as totalling £1.2m, with another £500,000 going into their bank accounts. 

Both Seth's claimed they did not know Capital Gains Tax was owed on the three properties they sold and denied telling deliberate lies in mortgage applications.

Naveen claimed he was "losing money" and made no profit from the rentals, explaining: "I live a frugal lifestyle. I went to a property seminar and got caught up in it."

He claimed the holidays were: "Cheap last-minute deals."

Savita is charged with seven counts and Naveen eight counts of obtaining a money transfer by deception on various dates between September 23, 2001 and March 9, 2005.

They relate to £150,000 from the Portland Building Society; £192,709 from Coventry Building Society; £229,900 from Bristol & West; £127,899 and £70,300 from Birmingham Midshires; £202,000 and £200,234 from Bradford & Bingley and £40,000 from the Chelsea Building Society.

Both are charged with attempting to obtain a money transfer by deception, namely £77,000 from Coventry Building Society.

Both are charged with cheating the public revenue between January 1, 1995 and February 12, 2012 by failing to declare tax on rental income and capital gains tax.

They are also charged with fraudulently obtaining tax credits between January 1, 2003 and January 31, 2011.

Naveen alone is charged with forgery between April 10, 2006 and February 2, 2012, namely a letter from Vishaka Peitris solicitors.

They have both pleaded not guilty to all counts.

Trial continues………..