(Alliance News) - Shares in Augean PLC fell sharply Friday after it announced it will "vehemently challenge" a GBP4.6 million penalty issued by the UK taxman following claims the waste management firm had not paid enough in landfill taxes.
Shares in Augean were 7.6% lower at 104.00 pence in London on Friday.
HM Revenue & Customs issued a notice that it intended to slap Augean South Ltd - a subsidiary of Augean - with a GBP4.6 million fine for the period covering early June 2013 to late May 2018. The tax authority expects to formally issue the penalty on August 30.
In 2018, Augean as a whole generated a GBP10.6 million pretax profit on revenue of GBP79.7 million the year prior.
HMRC has argued that Augean had failed to pay the correct amount in landfill taxes over a prolonged period of time. In April, Augean was issued with a demand for GBP34.7 million in taxes and a further GBP2.9 million demand in late July.
At the time, Augean warned it could also face penalties from HMRC related to the reported tax issues.
On Friday, Augean said it will "vehemently challenge and appeal" the intended penalty with the tax tribunal due in 2020.
"The group continues to believe, based on legal advice, that it has paid the correct amount of landfill tax and that HMRC's assessments and intended penalty are incorrect," Augean said in a statement. "No financial provision will be made for HMRC's assessments or the intended penalty based on legal advice received."
