Former BHS owner Dominic Chappell has been jailed for six years for evading £584,000 in taxes.
A Southwark Crown Court jury found him guilty of failing to pay tax of around £584,000 on £2.2m of income he received after buying the failed chain for £1.
The court heard the 53-year-old spent the money on two yachts, a Bentley and a holiday to the Bahamas.
Chappell’s lawyers claimed he became “utterly broke” after BHS’s “pension problem exploded” in 2015.
Mr Chappell controversially bought the retailer from tycoon Sir Philip Green that year, but the chain collapsed soon after in 2016. It led to the loss of 11,000 jobs and a pension deficit of £571m.
Chappell failed to pay the tax on £2.2m in income he received after buying the chain for £1 in 2015 from retail tycoon Sir Philip Green.
Meanwhile, he splashed out on a luxury lifestyle which included a £90,000 yacht, a Bentley Continental car, and a Bahamas holiday.
BHS collapsed in 2016 after 88 years on the high street – with the failure costing 11,000 jobs and leaving a gaping pension deficit.
In sentencing, the judge said Chappell had engaged in a “long and consistent course of conduct designed to cheat the revenue”.
“You are not of positive good character. Your offending occurs against a backdrop of successive bankruptcies,” he said.
Simon York, director of the Fraud Investigation Service at HMRC, said: “This was deliberate theft from UK citizens. Chappell was a high-profile businessman who knew tax had to be paid on his income and profits but chose not to do so.
“That’s money that should have been supporting our vital public services instead of funding his lavish lifestyle.”
BHS, once one of Britain’s best known retailers, was losing £1m a week and had a huge pension deficit when Chappell’s consortium, Retail Acquisitions, bought it in 2015.
Sir Philip Green was heavily criticised for agreeing to the deal, and later agreed a £363m cash settlement with the Pensions Regulator to plug the gap in the pension scheme.
“The settlement follows lengthy, complex discussions with the Pensions Regulator and the PPF, both of which are satisfied with the solution that has been offered.
“All relevant notices, including legal matters and claims from the regulator, have been withdrawn, bringing this matter to a conclusion.”
The tycoon, who with his wife Cristina is estimated by Forbes to be worth £3.8bn, said: “Once again I would like to apologise to the BHS pensioners for this last year of uncertainty, which was clearly never the intention when the business was sold in March 2015.
“I hope that this solution puts their minds at rest and closes this sorry chapter for them.”
However, on Thursday prosecutors condemned Chappell for spending large sums of money at a time when he should have been trying to save BHS.
The court heard Chappell, a former racing driver, also bought £11,000 worth of items from a gun and outdoor wear shop, including expensive Beretta firearms.
In his defence, Chappell argued he was too busy resolving issues with BHS to deal with the outstanding taxes that were due.
He had denied three charges of tax fraud.
Last year, Chappell was banned from running a company for 10 years, with the Government’s Insolvency Service saying he had carried out “reckless financial transactions” and “failed to maintain adequate company records”.
And earlier this year he was ordered to pay £9.5m into BHS pension schemes after losing an appeal.