Jailed nursery boss ordered to pay HMRC more than £900,000

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The co-owner of a nursery group jailed for defrauding his employees of nearly a million pounds in tax and national insurance contributions has been ordered to pay back the cash or face a longer sentence.

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Michael Scott has been ordered to pay HMRC £921,177

Michael Scott, now 64, has been ordered to pay back £921,177 within three months or face a further six and a half years in jail – and he would still owe the money to HM Revenue and Customs.

At the time of the fraud he was the owner of PixXieS Day Nursery and Pixies Too, with two branches in Locks Heath and Woolston in Southampton.

Mr Scott was found guilty of defrauding 180 employees of £950,000 by deducting their Pay As You Earn (PAYE) income tax and NI contributions from his workers’ salaries, and then failed to declare and pay HMRC the money. He also failed to declare and pay employer NI.

In 2015 he was jailed for five and a half years and suspended for being a company director for ten years.

Kevin Newe, assistant director, Fraud Investigation Service Proceeds of Crime Team, HMRC, said, ‘Michael Scott robbed his employees and the taxpaying public. It is crucial that we stop such criminals profiting from their crimes and this confiscation order will put the money back where it belongs - funding vital public services across the UK.

‘Our investigations do not stop at sentencing, and we will continue to seize cash and assets from criminals who try to cheat the system. If he doesn’t pay back what he owes Michael Scott will face another six and a half years in prison, and still owe the money.’

The trial followed an investigation by HMRC after concerns were raised by former employees about gaps in their income tax and National Insurance records.

Mr Scott’s ex-wife Marina was also charged but was acquitted during the trial in June 2015 and the case against her dropped.

The two nurseries continue to operate.

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