Self-assessment Tax Mess - member of the family

Self-assessment Tax Mess - member of the family

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Discussion

C.A.R.

Original Poster:

3,967 posts

187 months

Tuesday 17th January 2017
quotequote all
I'll try to be brief as this isn't something I fully understand myself yet!

- Member of the family was on JSA until November 2016
- started working as a part time labourer for a local landscaping / building company
- said company did not want to directly employ due to tax, insurance and pension issues (alarm bells for any sane person)
- "Thought" he registered as Self-employed in November last year - but received no correspondence (therefore no UTC)
- now (as in today) he is concerned about having to complete a tax return

Company pays relative just £60 a day. No paperwork has ever exchanged hands, money is just paid directly into relatives bank account. The only physical record which exists is a notebook where relative has acknowledged when he worked.

To my limited understanding of this situation it almost seems as though our relative has wound up in an illegal cash in hand job with the only difference being no physical cash.

I've looked up said "company" and there is nothing more than a Facebook page, no company website etc. The proprietor has previously been a director but is no longer listed as such for any company. Basically it doesn't seem to exist!

I'm worried said relative is being taken advantage of (not least due to the minimum wage elephant in the room) but he is worrying himself silly about the tax situation. In all fairness, at this level of pay he isn't likely to incur any income tax, legally employed or not, but he does fear for the security of his legitimately accrued pensions from previous employers and what this might mean for the future.

Just a couple of details to quash the inevitable How/What/Why's this will attract -
Said relative is severely dyslexic
Relative is nearly 60 years old with no formal qualifications - it is very difficult for him to find much in the way of work at all

Any assistance on where we go from here /what we do with the tax situation and this "company" he is not actively employed by would be very much appreciated.

TooMany2cvs

29,008 posts

125 months

Tuesday 17th January 2017
quotequote all
C.A.R. said:
- Member of the family was on JSA until November 2016
...
- "Thought" he registered as Self-employed in November last year - but received no correspondence (therefore no UTC)
- now (as in today) he is concerned about having to complete a tax return
He's got a year to worry about it. The current self-assessment deadline is for the financial year ending April 2016.

Jefftav

137 posts

172 months

Tuesday 17th January 2017
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He needs to keep a good record of payments both income and expenses and I think he should be invoicing the company. He could get a duplicate invoice book and add up how many days he has worked per month x£60 and give the invoice to the company he has worked for.

If he can't do it himself then it would be a good idea to set him up with some help to look after his business accounts so that he learns how to record payments and to put some money aside so he can meet his tax bill. Also they might be able to advise about offsetting the cost of work related expenses/equipment against his business.

Eric Mc

121,788 posts

264 months

Wednesday 18th January 2017
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Don't worry, in just over a year he'll have the joy of submitting quarterly updates to HMRC.