Did some part-time work and didn't declare.....
Discussion
Ok, I'll try and explain myself 
My part time job which I work throughout the year works out at about £90 a week or about £4680 each year.
Then during the summer I took another job working for a company that runs bars etc at festivals. 99% of the people who worked these festivals were either agency staff or were students like me. I think it worked out I got about £7 an hour and at times upto £9 an hour. Overall throughout the summer, from this company I made about £3-4k which I have not declared. At the time none of the staff even considered anything about any tax, but I worked it out roughly and figured the job would only ever be worth doing if we weren't going to pay any tax. Some people probably even thought that the wage they made would be their cash and the company was paying tax. Then on the very last festival we were all asked to sign these disclaimer documents. When I questioned why I had to sign the documents I was told in a casual friendly way by my boss that its just to protect their asses in cash of any eventuality such as what is happening now. No one declared tax and in the end everyone just forgot about it. I also very vaguely recall something about how the company expected us not to have income out of this summer work so we were within the tax threshold and did not have to pay any tax on those earnings.
Then in the last few days, a few of us have received calls from the company asking for our NI numbers and after speaking with them they told us that the company is being investigated by the inland revenue, but that they have been and gone. Surely theres got to be upto 100 staff who will end up getting sent tax payment letters from the inland revenue. My friend who worked for them this year has just been sent a letter for the tax amount he owes this year, but he's got till 2011 or something like that to pay it off. Does stuff like this also entail any forms of blacklisting which may affect me in the future.
I spoke with my friends who had worked for the company this year too and the company have tightened everything up and is paying everyone into their bank accounts and personally paying the taxes. The nature of the company and the type of work it does means that everything is done cash in hand so i think the tax man is going to be wary of what they do. Since they are selling alcohol at these festivals, everything is cash in hand from the consumer and alot of the staff were getting paid cash in hand. On top of this, i think the company was paying some of the event organisers on the sly for the pitches etc. Then I also heard when I working there that the company wasn't expected to make profit in the first few years it operated until it established itself.
Anyway, thanx for the help everyone.
My part time job which I work throughout the year works out at about £90 a week or about £4680 each year.
Then during the summer I took another job working for a company that runs bars etc at festivals. 99% of the people who worked these festivals were either agency staff or were students like me. I think it worked out I got about £7 an hour and at times upto £9 an hour. Overall throughout the summer, from this company I made about £3-4k which I have not declared. At the time none of the staff even considered anything about any tax, but I worked it out roughly and figured the job would only ever be worth doing if we weren't going to pay any tax. Some people probably even thought that the wage they made would be their cash and the company was paying tax. Then on the very last festival we were all asked to sign these disclaimer documents. When I questioned why I had to sign the documents I was told in a casual friendly way by my boss that its just to protect their asses in cash of any eventuality such as what is happening now. No one declared tax and in the end everyone just forgot about it. I also very vaguely recall something about how the company expected us not to have income out of this summer work so we were within the tax threshold and did not have to pay any tax on those earnings.
Then in the last few days, a few of us have received calls from the company asking for our NI numbers and after speaking with them they told us that the company is being investigated by the inland revenue, but that they have been and gone. Surely theres got to be upto 100 staff who will end up getting sent tax payment letters from the inland revenue. My friend who worked for them this year has just been sent a letter for the tax amount he owes this year, but he's got till 2011 or something like that to pay it off. Does stuff like this also entail any forms of blacklisting which may affect me in the future.
I spoke with my friends who had worked for the company this year too and the company have tightened everything up and is paying everyone into their bank accounts and personally paying the taxes. The nature of the company and the type of work it does means that everything is done cash in hand so i think the tax man is going to be wary of what they do. Since they are selling alcohol at these festivals, everything is cash in hand from the consumer and alot of the staff were getting paid cash in hand. On top of this, i think the company was paying some of the event organisers on the sly for the pitches etc. Then I also heard when I working there that the company wasn't expected to make profit in the first few years it operated until it established itself.
Anyway, thanx for the help everyone.
from that explination 2 things.
1. You should have never have signed that piece of paper - not that it helps the employer, its a bit like a bank robber getting you to sign to say you know helping him is illegal - it doesnt stop his actions being so (an employer has to pay NI contributions as well as you)
2. You should be lucky, worst case you'll get a bill from the IR, pay straight away, as they WILL add interest.
1. You should have never have signed that piece of paper - not that it helps the employer, its a bit like a bank robber getting you to sign to say you know helping him is illegal - it doesnt stop his actions being so (an employer has to pay NI contributions as well as you)
2. You should be lucky, worst case you'll get a bill from the IR, pay straight away, as they WILL add interest.
fidgits said:
2. You should be lucky, worst case you'll get a bill from the IR, pay straight away, as they WILL add interest.
Agreed, play nicely with them and you'll be fine. Be honest with them, don't try to deceive them - they aren't interested in you they'll want to cane the employer.
hope it works out OK for you.
On the whole, the Revenue will probably be fairly lenient with you. Most of their ire will be reserved for this "employer" who have been obviously playing fast and loose with the tax rules. Naievity and ignorance of the tax rules is no defence if and when the Revenue come chasing you - but they may take it into account when deciding how hard they want to come down on you.
Signing that bit of paper was a bad idea in that you will be seen to have been complicit in the overall tax fraud being perpetrated by the employer. Your best defence (if you need to defend yourself) is that the employer placed you under pressure to sign it.
Signing that bit of paper was a bad idea in that you will be seen to have been complicit in the overall tax fraud being perpetrated by the employer. Your best defence (if you need to defend yourself) is that the employer placed you under pressure to sign it.
qwertyford said:
Ok, I'll try and explain myself
...
I worked it out roughly and figured the job would only ever be worth doing if we weren't going to pay any tax
...
I worked it out roughly and figured the job would only ever be worth doing if we weren't going to pay any tax
That's like saying "I'm about to die of thirst, but I won't accept that glass of water as you might spill a bit before I get to drink it"
Not necessarilly. This misdemeanour occured under the auspices of your employer failing to properly handle the payments he was making to you. He encouraged you to sign something of which you were not aware of the full implications of what you were signing.
In actual fact, if this happened in the tax year 2005/06, you are still within the deadline date period for reporting this yourself. If you want to declare this personally on a Self Assessment tax return, you will have until 31 January 2007 to do this AND pay any outstanding tax and NI. However, that would be if you were happy to report this income as Self Employed income. This employer was wrong to try and indemnify himself from any respnsibility for paying tax on what he paid you. What he was trying to do was get you to admit that you were, in effect, Self Employed and that all respnsibility for reporting this income to the Revenue was yours, not his.
Unfortunately for him, it is not within his power (nor yours) to decide whether you are self employed or not. Employment/ Self Employment status is a question of fact, not choice.
It seems to me that the activity he "employed" you for fell squarely within the definition of "Employment", which puts the bulk of the respnsibility for deducting tax and paying it over onto his shoulders.
In actual fact, if this happened in the tax year 2005/06, you are still within the deadline date period for reporting this yourself. If you want to declare this personally on a Self Assessment tax return, you will have until 31 January 2007 to do this AND pay any outstanding tax and NI. However, that would be if you were happy to report this income as Self Employed income. This employer was wrong to try and indemnify himself from any respnsibility for paying tax on what he paid you. What he was trying to do was get you to admit that you were, in effect, Self Employed and that all respnsibility for reporting this income to the Revenue was yours, not his.
Unfortunately for him, it is not within his power (nor yours) to decide whether you are self employed or not. Employment/ Self Employment status is a question of fact, not choice.
It seems to me that the activity he "employed" you for fell squarely within the definition of "Employment", which puts the bulk of the respnsibility for deducting tax and paying it over onto his shoulders.
qwertyford said:
I'm a university student and did some part time bar work last year and didn't declare any of my earnings.
Now, just got a call from that company that wants my national insurance number. After asking more questions they tell me that their business is being investigated by the inland revenue but they've been and gone yesterday, yet they still wanted my NI number for future reference. Then they told me the revenue have got my name and if they wanted they could just find my NI from my name.
Have I got anything to worry about since I had also been working throughout the rest of last year.
Now, just got a call from that company that wants my national insurance number. After asking more questions they tell me that their business is being investigated by the inland revenue but they've been and gone yesterday, yet they still wanted my NI number for future reference. Then they told me the revenue have got my name and if they wanted they could just find my NI from my name.
Have I got anything to worry about since I had also been working throughout the rest of last year.
I think you'll find the Revenue will be gunning for the employer not you - that's the way it is! I've got an audit next month and I'm currently swatting up for it.
Am interested in the employers liability here, I am pretty sure these "we'll pay you this and sign here to accept that you are liable for paying your own tax" agreements are fairly commonplace. I know my wife's company have used them in the past for people who come in on very short term basis when running things like mystery shoppers etc, they are pretty big and sure they have covered themselves on this. Or are we saying that in this case the problem is because the employer only asked late in the day after a number of payments were made. What we are effectively talking about is someone working freelance surely?
So as the situation stands, should I try and declare what income I made because the employment was from july 2005 to about September 2005. However, if I did this I'd have to ask the company for pay slips etc.
(OR)
Should I stay quiet and just wait to see if anything happens. Then only pay when they send me a letter stating how much I owe them.
Thanx for the help again.
(OR)
Should I stay quiet and just wait to see if anything happens. Then only pay when they send me a letter stating how much I owe them.
Thanx for the help again.
I'm no expert but I'd be tempted to go with (3) contact them and say that you believe that from what you have been told this employer did not make NI and PAYE payments on your behalf whilst they were employing you. You realise that you have been very naive by signing the "waiver" they asked you to sign and you are only now understanding what has gone on. I think on that basis you might be able to persuade the IR to go after them for the amounts not you.
If you go for declaring the earnings as self employment you'll have to pay Tax and NI on them with no chance of sticking them on the employer.
I await Eric to put me right
If you go for declaring the earnings as self employment you'll have to pay Tax and NI on them with no chance of sticking them on the employer.
I await Eric to put me right
If you went down the Self Employed route you would certainly have to pay the tax arising on the income received (after deducting your legitimate business costs - of course). However, based on the ammounts revealed so far, it looks like you might have been under the NI limits for this income so would have no Self Employed Class 2 or Class 4 NI liabilities arising.
...and as much as we all dislike paying tax, sounds like the company profits or back pockets of directors were being inflated with the tax they and you should have paid.
I think it speaks volumes that they ask you to sign at the end, as I thought the 'student working, no tax payable' thing should be signed when they start to work for you?
I am glad I am not a director at that company right now.
You lot need to chill out.
Firstly, do bugger all until the tax man contacts you. do NOT under ANY circumstances EVER for ANY reason volunteer information of ANY kind to ANY representative of HMRC. i hope this is clear enough. There is very very little you are legally obliged to tell them frankly.
secondly, IF the inland revenue (and they are a useless bunch of
s who should all be shot) send you a letter asking where you worked at a certain period you should answer truthfully (as they are checking). You could just lie and make it up which is something you could get away with but i wouldn't recommend it in this case.
If they then write to you again saying you signed some bit of paper then tell then write back and demand to see a copy along with a note that the company you worked for forced you to sign all sorts of things. Also tell the revenue that the company have had your National Insurance number, and that because you trusted them then you just assumed what they paid you was correct. Basically plead ignorance. The worst that will happen is that you will have to pay back the NIC and tax, which will probably be taken when you are earning through PAYE.
Guys HMRC has much much much bigger fish to fry than this one employee who might owe a couple of hundred quid- oh yeah if you don't have the money (or don't want to pay it all) write them a letter saying you accept the position, are desperate to clear it all up, are vey sorry, you were a victim of cirumstance, and offer them 50% of the amount they want as full and final settlement (make sure you write that last bit). if they cash the cheque then job done.
Frankly you have nothing to worry about- The revenue have very very very very very few powers- the worst they can do is take you to court. They cannot come into your home, your business, can't look in your records without a warrant, and they can't interview you without your permission. If they want a meeting for any reason, just tell them that you are not happy to meet them but you would happy to conduct all matters by mail.
Firstly, do bugger all until the tax man contacts you. do NOT under ANY circumstances EVER for ANY reason volunteer information of ANY kind to ANY representative of HMRC. i hope this is clear enough. There is very very little you are legally obliged to tell them frankly.
secondly, IF the inland revenue (and they are a useless bunch of
s who should all be shot) send you a letter asking where you worked at a certain period you should answer truthfully (as they are checking). You could just lie and make it up which is something you could get away with but i wouldn't recommend it in this case. If they then write to you again saying you signed some bit of paper then tell then write back and demand to see a copy along with a note that the company you worked for forced you to sign all sorts of things. Also tell the revenue that the company have had your National Insurance number, and that because you trusted them then you just assumed what they paid you was correct. Basically plead ignorance. The worst that will happen is that you will have to pay back the NIC and tax, which will probably be taken when you are earning through PAYE.
Guys HMRC has much much much bigger fish to fry than this one employee who might owe a couple of hundred quid- oh yeah if you don't have the money (or don't want to pay it all) write them a letter saying you accept the position, are desperate to clear it all up, are vey sorry, you were a victim of cirumstance, and offer them 50% of the amount they want as full and final settlement (make sure you write that last bit). if they cash the cheque then job done.
Frankly you have nothing to worry about- The revenue have very very very very very few powers- the worst they can do is take you to court. They cannot come into your home, your business, can't look in your records without a warrant, and they can't interview you without your permission. If they want a meeting for any reason, just tell them that you are not happy to meet them but you would happy to conduct all matters by mail.
pugwash - with respect, I have to say you are talking out if your bottom.
The Revenue have pretty VAST poweers and they are growing all the time. Do not listen to what pugwash is saying as he is basically telling you that it is OK to behave in a criminal manner.
If pugwash himself behaves in this manner, he is heading for trouble.
The Revenue have pretty VAST poweers and they are growing all the time. Do not listen to what pugwash is saying as he is basically telling you that it is OK to behave in a criminal manner.
If pugwash himself behaves in this manner, he is heading for trouble.
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