AN ONLINE trader who lied on his tax return to steal more than £12,000 from the taxpayer has been given a suspended prison sentence.

After being dismissed from HM Revenue & Customs’ contact centre in Peterlee in 2009, Neil James Foster, 32, of Easington Village, set up an online business trading games consoles, video games and DVDs.

But an investigation into his tax affairs found that he had fraudulently declared business losses that enabled him to claim income tax repayments totalling £12,319.

Diane Donnelly, assistant director of criminal investigation at HMRC, said: “As someone who used to work for HMRC, Foster knew that lying on his tax return, with the sole aim of lining his own pockets, was going to land him in court.

“Tax fraud is not a victimless crime, and we will always rigorously pursue those who we suspect of being involved in such criminality.

“It is vital that we are able to effectively collect the taxes needed to keep the country’s public services running.”

Alongside his online business, Foster also worked for an energy company, earning a salary with tax deducted through PAYE.

It was during this employment that he submitted self assessment forms, which fraudulently showed his business had made financial losses of almost £31,000 between 2009 and 2011.

The alleged losses were offset against tax he had already paid through his employment with the energy company, and Foster was paid tax refunds totalling £12,319.

He pleaded guilty to four counts of being knowingly involved in the fraudulent evasion of income tax at Newcastle Magistrates’ Court last month.

Foster of Clappers Gate, Easington Village, was sentenced to eight months in prison, suspended for 12 months, and ordered pay £165 in costs at Peterlee Magistrates’ Court today (Friday, May 22).