Did some part-time work and didn't declare.....

[srebbe64]

Eric Mc said:

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.

I'm inclined to agree. When he comes to fill in his Tax Return it's going to ask what income has been received. I assume that Pugwash's advice is to lie. I've found that if you going to pick a fight with a powerful adversary (no matter how stupid) best to play by the rules.

[Eric Mc]

Quite right.

The Revenue are a powerful adversary. Do not go out of your way to antagonise them.

[pugwash4x4]

I obviously didn't make the point of my post clear.

The revenue really don't have very strong powers. You might be scared of them but that is the truth. The point of my post was NOT to be scared of them- what exactly do you think they will do to you or these guys?

The point i am trying to make is NOT to make life easy for the revenue- the burden of proof is up to them in all matters (completely opposite to HMCE of course). Do not tell them things they do not need to know- i have been in cash based businesses (like fast food) which have an industry rep of being "dodgy" for over 10 years- i have 6 different businesses and have been reviewed every three years in every business and investigated 3 times. Almost every time i have had a small amount to pay as you would expect- in my experience they aren't that fussed about losing a few quid here and there as long as they get the big boys.

srebbe64 i would wonder why he would be receiving a tax return- he isn't self employed, isn't P11d, doesn't have any tax arrangements. Why on earth would he get a tax return to fill in?

So far we have a chap shitting himself because he "might" owe the revenue a couple of hundred quid, and the advice on here is that you could be subject to a criminal investigation. have any of you had any experience of the revenue? this guy needs to calm down and look at the situation rationally- the VERY worst that will happen, as long as he doesn't admit to criminal intent, is that he pays some money back. What everyone else seems to suggest is that you tell the tax man that yes you purposefully, with foreknowledge of all consequences, ripped off the tax man and in a criminal manner. Get real chaps.

Eric Mc- i don't konw what powers you think the Inland revenue have but they really aren't that scary in the big scheme of things. They aren't even a preferential creditor anymore! HMCE scares me shitless and i really really really really don't want them knocking on my door.

I will never ever let myself be intimidated with lazy good for nothing parasites like the revenue and/or customs, whose only thought is to meet targets- i will tell them the bare minimum i am required by law (which is considerably less than everyone seems to think- for example did you know that you don't have to have a face to face meeting with Revenue- they can request it but they can't force you? did you also know that if HMCE asks for notes or information you should NEVER answer immediately- you are perfectly within your rights to make them wait 10 days as this is how long they will make you wait- and if you make them wait it CANNOT prejudice a review or an enquiry). In case you guys haven't worked it out yet the government and civil service are NOT on our side, do not help them- know your rights and use them.

i feel extremely strongly about this- my father lost his business, his wife, his livelihood and ultimately committed suicide because of the actions of one VAT officer in the execution of his DUTY. The officer lied and falsified evidence- there was no appeal. you will never understand how strongly i feel about civil servants.

anyway before i get all emotional i hope you guys understand where i am coming from now.

[qwertyford]

As the guilty evil criminal culprit behind this big farce, I have to say that you lot are getting me quite worried. If I don't know how much I actually made last summer, should I just send them a rough declaration and wait for the letter telling me how much they want me to pay.

[pugwash4x4]

NO NO NO NO NO NO NO NO NO NO NO NO NO

they will contact YOU if they want information. Answer this letter truthly. wait for a reply, see what it says and then frame a letter to them- explain the situation making it clear that you thought the company you were working for was above board- if they want to produce some piece of paper then you can ask them for a copy, then say you didn't understand what you were signing and that you were told it was just for the companies records.

The worst that will happen is that you will have to pay the money back- and the revenue are usually open to offers. Do not offer anything up. At the moment the revenue are after the company and NOT you. Do not get them started on you for no reason.

As far as i can work out you earnt about £8 grand- your PA is 4950, the next 1520 is taxed at 10% and the rest at 22%, you would therefore owe around £342 in NIC and £432 in Ta. That would probably be taken by a change in your tax code so you would pay more tax next year. They MAY ask for it up front, in which case you can make an offer.

PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE PLEASE stop worrying so much. What do you thinkg they can do to you?

[Touching Cloth]

Pugwash I know your intentions are good but to put you in the picture, Eric is an accountant who deals with this stuff day in and day out, Srebbe buys and sells businesses for a living (as I understand). Both will have dealings with the Revenue that probably exceed that of most people that I know. The posts on the whole have recommended that the OP just be truthful and honest, if you come across as tricky and evasive then I would imagine they will want to investigate further assuming you have more to hide.

Furthermore the posts that I have seen are not putting the fear of god into the chap, most agree and say that they will be after the big guy not the small guy in this case. Here are some examples of what I see on this thread.

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.

Piglet said:

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.

srebbe64 said:

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.

2 sMoKiN bArReLs said:

The tax man can go for both company & individual....going for the company is the easier option. They can get quite severe penalties, generally in my experience the employee gets off with just the missing dues, plus some interest (if pursued)

[pugwash4x4]

Touching cloth,

thanks for the reply- and i take what you said on board but this chap sounds very very worried and isn't taking the sensible posts on board but more seems to be listenting to those who are preaching doom and gloom- a sense of perspective is needed rather quickly.

As to accountants- well it has taken me almost 10 years and what has turned out to be a huge amount of money to find an accountant who is more interested in protecting my businesses (totally legally i might add- although going as close to the wire as possible) than protecting there own backs. (Just so you know i have a degree in accountancy and finance and am a member of the ICAEW- i am not totally inexperienced myself ).

[srebbe64]

Pugwash, clearly the issue of the rip-off merchants who represent Her Majesty have had a personal impact on you, and, sadly, many others. They are 'the enemy' which is why I'm looking at various possibilities (Monaco, The Caymans, etc) - ultimately I'll neec to sell it to the wife!! However, you will NEVER see me misleading, or picking a fight with, the IR. It's important not to confuse 'common sense' with Tax - the two are utterly unrelated. As such, it's important to get professional Tax planning, following which 'pay your taxes'. Sad to say but you're wrong! The petty minded civil servants are as interested in a barman taking tips as, say, Robert Maxwell, because (pethetic) Civil Servant will be promoted when he/she catches evil criminal.

Lesson: The IR are like nothing you encounter in the rational universe. They are completely bonkers, but have access to yours and my bank accounts, et al. George Orwell was on the money!!

[pugwash4x4]

Hey srebbe

it's really re-assuring to hear that you feel the same way about tax men as I do- it seems to be a more and more uncommon feeling nowadays even among those in business.

I cetainly never pick a fight with the taxman, but then neither do i just roll and let him me for everything he can. If he wants to investigate then i go out of my way to make life difficult for him- last investigation i gave him all the information he wanted, just not in the format he wanted- it took him 2 years and an awful lot of work and he eventually settled for £800. Of course i still end up paying taxes every year- don't we all- but i legally and ethically avoid as much as i can. I think last year i paid our tax accountants more than they saved us with some of the schemes they came up with- but i'd rather give the cash to them than then revenue.

i hope an off shore move works for you- it is something i have always wanted to do, but my business partner who did it a few years back has had the revenue all over him every year like a rash! It sounds like you know what you're doing though so i think i'll shut up now.

[Eric Mc]

pugwash - you seem to differentiate between the Inland Revenue amd HM Customs and Excise. Since April 2005 THEY ARE ONE AND THE SAME BODY- now called Her Majesty's Revenue and Customs (HMRC). Part of the reason for this merger is that the new body will eventually assume all the powers of both the now defunct IR AND HMCE. So, if you were genuinely scared of HMCE - then be scared of HMRC too.

Also, since 2003 there have been two new pieces of legislation which changed forever the relationship between the citizen and HMRC - the Proceeds of Crime Act and the Money Laundering Regulations. They fundamentally change notification procedures and the powers of the authorities (including HMRC) to access and seize financial data and pass massive respnsibility for disclosure onto third parties - such as banks, accountants, solicitors and even retailers.

We are living in a very different world to even three years ago.

Edited by Eric Mc on Saturday 21st October 08:38

[srebbe64]

Hi Pugwash. I most certainly do have a loathing of The Revenue - I've been selectes for a PAYE audit next month. The Civil Servant selected (incidentally, I don't find them either 'civil' and they certainly don't provide a 'service' to be proud of). Anyway, said Civil Servant will be asked for their ID, given a cold empty office, will have no access to tea / coffee, no one will talk to them, other than answer questions in words of one syllable. I understand that they're on a weekly target of about £70k per week. As such, my attitude is that if they find, say, £10k, then I'm £60k up on the deal. That's my way of keeping my sanity!!

[JonRB]

Eric Mc said:

pugwash - you seem to differentiate between the Inland Revenue amd HM Customs and Excise. Since April 2005 THEY ARE ONE AND THE SAME BODY- now called Her Majesty's Revenue and Customs (HMRC)

Indeed. These "lazy good for nothing parasites like the revenue and/or customs" as you call them, pugwash, now have powers that the police only dream of - just like the powers of the old HMC&E of which you said "scares me shitless and i really really really really don't want them knocking on my door". Well the whole of HMRC have those powers now.

New underpants for pugwash please.

[pugwash4x4]

Hi All,

Eric, am well aware of joining of powers between HMCE and HMR, to HMRC (which is why i had referred to them as all three) and it does scare me. BUT, revenue offices do NOT have the same powers as Custom still, and they aren't sahring the same database yet. Whatever you have read (unless it has changed in the last 4 weeks) then they just don't have the same powers. When their powers align then i'll really shit myself and probably leave the country - in my experience the only s who want to work for HMRC are exactly the sort of people who shouldn't work for them and giving them this sort of power is extremely unhealthly for the economy and the country. As you say these powers will be EVENTUAL.

The new legislation will only work if all the accountants and solicitors end up running scared of the government- i have spent a long time looking for an accountant who really doesn't give a crap if the goverment investigate him- he is willing to protect me from the government, not work on their behalf to turn us over. We fell out with our last accountant because he was going to tell HMCE that their had been £100 of "slippage" one month- it was just an accounting mistake on my part!

Only small glimmer of hope is that they are no longer preferential creditors- so if you are going to go bust you might as well them over as much as possible- only downside to this is that you have to go bust into the process

Srebbe you are truly a man after my own heart. I have a VAT review next month, chap is getting a table and chair in our spud shed!!!! one very small light and very dark, dingy and smelly. he most certainly isn't going to be allowed to talk to the staff, neither will he get any welcome (no hob nobs here for those wankers)- i am considering leaving the door open and sitting and staring at him for 3-4 hours. Make him as uncomfortable as possible!

Like your thinking on the money thing- i always make some mistakes in the accounts on purpose so that they can find them and say "caught you". I can apologise and say how sorry i am and pay whatever they have found- i have a very good friend of mine who owns a number of fish and chip shops which turn over a considerable sum- his books and bussiness are SQUEEKY clean down to the penny- he had a review and they stayed with him 8 days until they found something!

[srebbe64]

Some years ago we were having a Tax inspection and while this was going on my accountant discovered an 'over-payment'. Because Mr Ferret was in residence I asked him to confirm it was indeed an over-payment and (very begrudgingly) confirmed it was. When he'd finished the audit I said "I'm delighted you came because it's highlighted an over-payment issue so in future my Tax liability will be reduced, plus I'll get a rebate!" He looked less than impressed. It's moments like that that make it all worthwhile!!

[Eric Mc]

I agree that the acquisition of old HMCE powers to all of the new HMRC is an ongoing process - but it is happening.

However, the Proceeds of Crime Act and the Money Laundering regulations are in force NOW so do not think that just because you omit to tell the authorities something that you will be given an easy ride if and when they find out.

Unfortunately, accountants have been instructed (under pain of criminal prosecution) to report suspicious findings to what was originally NCIS (National Criminal Intelligence Service)and now the SOCA (Serious and Organised Crime Agency). Dawn Primorolo was questioned in the House of Commons as to what constituted a serious criminal fraud and she said that there were no lower limits to the reporting regulations. ALL frauds had to be reported.

It has put accountants in a very precarious position regarding their clients.

[JonRB]

pugwash4x4 said:

i have spent a long time looking for an accountant who really doesn't give a crap if the goverment investigate him- he is willing to protect me from the government, not work on their behalf to turn us over.

Good luck in finding both a bent accountant and one who will be prepared to take a fall for you if his bentness is discovered.

Do you clock your cars before you sell them as well and only offer some of the money back if the buyer actually discovers it and confronts you with it?

[pugwash4x4]

John what are you talking about.

i am talking about an accountant who will do every LEGAL and ETHICAL thing to make sure i don't pay any tax- or as little as possible. if that means that some of the decisions are in a grey area then great i want him to take that risk. If you think the only way not to pay tax is to evade then you have a lot to learn. The problem nowadars is that

i have never, and would never, countanane tax evasion.

unfortunately in my experience 99% of accountants have no interest in reducing your tax burden- they are only interested in being as close to the letter of the law as possible without taking any risks. i have no interest in this sort of accountant- they are self-serving and don't deserve the money they charge- at this rate they are getting to be worse than the law profession!

John, if you think everything i have said above suggests that i am into illegal schemes then then good on to you. unfortunately we will never have a meeting of minds.

[viggen114]

What the difference between tax evasion and tax avoidance

Show Spoiler

Spoiler

the thickness of a prison wall

[JonRB]

pugwash4x4 said:

i am talking about an accountant who will do every LEGAL and ETHICAL thing to make sure i don't pay any tax - or as little as possible.

Ah, I see. Ok, that clarifies things a little.

pugwash4x4 said:

unfortunately in my experience 99% of accountants have no interest in reducing your tax burden- they are only interested in being as close to the letter of the law as possible without taking any risks.

Ok, I can see where you are coming from now. Up to a point I would agree with you, but I would also counter by saying that the accountants who have a reputation of being 'squeaky clean' rarely find their clients getting investigated whilst those who sail close to the wind and wring every last barely-legal penny out tend to get investigated far more often.

I've been trading for 7 years now and I've never had so much as an audit, let alone an investigation. I put that mainly down to my account being a Chartered Certified Account and registered Auditor who has a reputation of being squeaky-clean. Ok, maybe I pay a few tens or maybe 100's of pounds extra a year in tax but at least I have a quiet life and don't have to spend valuable billable time entertaining the local Hector at my offices when I could be off earning.

It's "swings and roundabouts" at the end of the day really.

[srebbe64]

The way I see it is that accountancy (as in auditing the books etc..) and Tax planning advice are unlikely to be one and the same person. The latter of the two is highly specialist. Personally, I use a specialist Tax planning consultancy who communicate directly with my accountant so there is agreement and transparency all round.