A GIFT shop on a busy street in Edinburgh has been accused of tax evasion following an investigation into shop units rented from a company founded by one of Britain’s richest men.
An investigation carried out by London Centric found that a row of gift shops on one of the busiest streets in the English capital, which share the same landlord company as the store in Edinburgh, have allegedly cost taxpayers millions of pounds over the last decade.
Edinburgh’s Kingdom of Treats has allegedly been engaged in “phoenixing”, where the legal owner of a shop changes every few months and the old owner vanishes without ever paying their taxes, along with a string of English gift stores.
London Centric launched an investigation into Piccadilly Circus: Kingdom of Treats and Souvenir Megastore after local politicians and other legitimate gift stores raised concerns that business renting from a company founded by one of the UK’s richest men was not paying tax.
The publication also sent journalists to knock on doors at dozens of addresses across London and Edinburgh where the legal operators of the shops supposedly live or work, to ask whether they intended to pay their taxes.
They found that often the legal tenants of the gift shops accused of avoiding tax are often overseas students from India, Pakistan, or Bangladesh who have registered the business under abandoned offices, or even car parks.
London Centric also discovered that the supposed gift shop owners leased the properties for their businesses from Criterion Capital, which was founded by the billionaire property developer Asif Aziz (below).
The billionaire reportedly moved his tax residency to Abu Dhabi in 2024 amid concerns the Labour Government could increase taxes on wealthy individuals, according to The Times.
There is no legal responsibility for a landlord to enforce the payment of taxes by their tenants.
Lawyers for Aziz told London Centric that while he is a founder of Criterion Capital, he is “not involved in the matter of day-to-day lettings” and this is a matter for “the commercial letting team at Criterion Capital.”
The lawyers said Aziz and Criterion deny any involvement in “phoenixing” and added that “lettings are made to commercial tenants on standard commercial terms”, and a landlord is “entitled to let to tenants who will pay a market rate for the property.”
London Centric’s investigation found that just monitoring the tills at Kingdom of Treats and Souvenir Megastore for an hour, they both raked in hundreds of pounds.
“Everyone says they’re money laundering,” explained a former tenant of one of Aziz’s units, who shared details of the shops’ operations with London Centric.
“They’re not money laundering. They’re taking serious money.”
The gift shops which were investigated were allegedly not adding VAT to sales, which is a 20% levy on most purchases in the UK, with some till operators apparently confirming that they do not add the tax to customers' purchases.
Businesses are required by law to start charging VAT when they expect their annual turnover will hit £90,000.
They also found that the gift shops in question were not paying business rates, the corporate equivalent of council tax, and instead they have a different company with a different director legally in charge of the business every few months, with the previous owner disappearing.
According to a former tenant of one of the gift shops in London the business model is based on the knowledge that the authorities are failing to enforce tax laws when it comes high street businesses along with the ease of paying overseas students a few thousand pounds to sign legal paperwork on behalf of the real operators — before vanishing without paying taxes.
When approached with the findings from London Centric, HMRC said they could not comment on individual cases but encouraged them to send their data to their fraud team.
