Oh **** help with Inland Revenue problems PLEEEASE
Discussion
Found out this morning a friend has a problem with tax and NI payments and would REALLY appreciate any Pistonheaders advice.
Basically 'the friends' last but one employer (2001 to 2002) was taking deductions from 'friends' pay, but not sending them off to the Inland Revenue. Not a huge problem 'cos 'friend' has all payslips showing gross and net pay, so IR say they would go 'after' the employer.
But friends present employer (last 6 months) refuses to give friend a contract or weekly payslips.
Concerned about this 'friend' rang the I.R. people working on the former case. It turns out the present employer did have 'friend' listed on his 'payment scheme'(?) but after 2 months (ie 4 months ago) sent the I.R. a P45 stating 'friend' had left his employment.
Friend knew nothing of this. Friend has continued getting the same 'net' weekly amount by cheque, but has no records of the gross amount received, and hence no record of paying any tax or NI!
After talking to the I.R. they are a bit off hand, saying wait to see if employer produces a P60 at the end of the year (or a P45 if she leaves that job), and put concerns in writing to them 'just in case'.
But surely she is leaving more time for any payment liability to increase, to be demanded later when the IR sort themselves out?
And how can employer make payment, if 'friend' is not down as an employee any longer?
I am going to tackle employer tonight about it, but need to tread carefully as...errr... he has some dodgy aquaintances alledgedly etc (I did not say protection money
)
This is not good - any advice gratefully received.
Names changed to protect the s**t scared
Cheers, Phil
Basically 'the friends' last but one employer (2001 to 2002) was taking deductions from 'friends' pay, but not sending them off to the Inland Revenue. Not a huge problem 'cos 'friend' has all payslips showing gross and net pay, so IR say they would go 'after' the employer.
But friends present employer (last 6 months) refuses to give friend a contract or weekly payslips.
Concerned about this 'friend' rang the I.R. people working on the former case. It turns out the present employer did have 'friend' listed on his 'payment scheme'(?) but after 2 months (ie 4 months ago) sent the I.R. a P45 stating 'friend' had left his employment.
Friend knew nothing of this. Friend has continued getting the same 'net' weekly amount by cheque, but has no records of the gross amount received, and hence no record of paying any tax or NI!
After talking to the I.R. they are a bit off hand, saying wait to see if employer produces a P60 at the end of the year (or a P45 if she leaves that job), and put concerns in writing to them 'just in case'.
But surely she is leaving more time for any payment liability to increase, to be demanded later when the IR sort themselves out?
And how can employer make payment, if 'friend' is not down as an employee any longer?
I am going to tackle employer tonight about it, but need to tread carefully as...errr... he has some dodgy aquaintances alledgedly etc (I did not say protection money
) This is not good - any advice gratefully received.
Names changed to protect the s**t scared
Cheers, Phil
start looking for another job.
put concerns in writing to tax office.
photo-copy the cheques each and every week.
IIRC every employer is legally bound to stop tax and NI from any employee that works for them more than 15hrs per week. so the employer should theoreticall get FCUKED over big style by the Tax Office.
employer has to provide a P60 at the end of tax year whether or not the employee is still working for them.
cooking the books, fiddling the wages cheque through as a 'legitimate' expense, thus pocketing the tax and NI stopped and not having to pay Employers NI contribution which is 10% of gross wage.
I wouldnt tackle them, keep plodding on until another job is found and then request a P45 when 'friend' leaves, if it is not forthcoming fill in form P46 for the new employer and await P60 at end of tax year.
>> Edited by Marcos maniac on Wednesday 12th February 14:52
put concerns in writing to tax office.
photo-copy the cheques each and every week.
IIRC every employer is legally bound to stop tax and NI from any employee that works for them more than 15hrs per week. so the employer should theoreticall get FCUKED over big style by the Tax Office.
employer has to provide a P60 at the end of tax year whether or not the employee is still working for them.
And how can employer make payment, if 'friend' is not down as an employee any longer?
cooking the books, fiddling the wages cheque through as a 'legitimate' expense, thus pocketing the tax and NI stopped and not having to pay Employers NI contribution which is 10% of gross wage.
I am going to tackle employer tonight about it, but need to tread carefully as...errr... he has some dodgy aquaintances alledgedly etc
I wouldnt tackle them, keep plodding on until another job is found and then request a P45 when 'friend' leaves, if it is not forthcoming fill in form P46 for the new employer and await P60 at end of tax year.
>> Edited by Marcos maniac on Wednesday 12th February 14:52
The first employer it seems your friend is happy for the the I.R. to deal with. She has settled her liability, and her employer is effectively a collector of the taxes, and will is liable for the amounts due.
1) The second employer had her listed as an employee but does not any longer.
2)Also, she has been paid with deductions for PAYE/NI but no payslip to detail those deductions.
The I.R. are now very strict on companies with regards to NI/PAYE and try to levy all the blame on a company. If she was once listed as an employee, but not now, it makes sense that the employer would be declaring her as self employed (contracted). I imagine the net amounts she receives are fixed weekly/monthly amounts?
He would need to declare invoices received from her, and if he cannot, especially if she denies being self employed then it is he who will be held responsible. It will be a company debt to the I.R. I can't see that being a problem. Only thing is, why does this happen to her twice in a row?
Non issue of payment slips is illegal, so once they cannot prove she is self employed, they will be in a little trouble with I.R. For the while, they are saving themselves 10% NI.
That's assuming they don't fold in a little while, owing debts to I.R. HM C&E and suppliers etc, with a debenture in favour of themselves, and then open another company with a very similar trading name in the same location, with their brother or a member of family in charge
Hopefully they won't be into fraud either, and so won't produce invoices from your friend to them, as a contractor. Good luck, and start searching for another job, ooops sorry I meant tell your friend to start searching for another job.
1) The second employer had her listed as an employee but does not any longer.
2)Also, she has been paid with deductions for PAYE/NI but no payslip to detail those deductions.
The I.R. are now very strict on companies with regards to NI/PAYE and try to levy all the blame on a company. If she was once listed as an employee, but not now, it makes sense that the employer would be declaring her as self employed (contracted). I imagine the net amounts she receives are fixed weekly/monthly amounts?
He would need to declare invoices received from her, and if he cannot, especially if she denies being self employed then it is he who will be held responsible. It will be a company debt to the I.R. I can't see that being a problem. Only thing is, why does this happen to her twice in a row?
Non issue of payment slips is illegal, so once they cannot prove she is self employed, they will be in a little trouble with I.R. For the while, they are saving themselves 10% NI.
That's assuming they don't fold in a little while, owing debts to I.R. HM C&E and suppliers etc, with a debenture in favour of themselves, and then open another company with a very similar trading name in the same location, with their brother or a member of family in charge
Hopefully they won't be into fraud either, and so won't produce invoices from your friend to them, as a contractor. Good luck, and start searching for another job, ooops sorry I meant tell your friend to start searching for another job.
MM is exactly right. This guy is going to be absolutely reamed by the tax people. Your friend needs to keep very accurate records and get another job as soon as possible. A letter to the Revenue stating when this came to your friend's notice is a must - as otherwise your friend could be found to be in collusion with the employer to evade paying tax. Not good.
Shortly it will be very, very bad to be around this bloke as the offence he's committing is quite grave - in the eyes of the Government.
Shortly it will be very, very bad to be around this bloke as the offence he's committing is quite grave - in the eyes of the Government.
It turns out the present employer did have 'friend' listed on his 'payment scheme'(?) but after 2 months (ie 4 months ago) sent the I.R. a P45 stating 'friend' had left his employment.
Friend knew nothing of this. Friend has continued getting the same 'net' weekly amount by cheque, but has no records of the gross amount received, and hence no record of paying any tax or NI!
The IR will if required get copies of all previous cheques to your friend from employers bank and when the two amounts tally/match up eg wages prior to initial request for p45 ther is gonna be one hell of a lot of Shite Flying.
Confirm your suspicions in writing today
Really do appreciate the help.
My clumsy post was trying to hide the fact the has happened to my utterly honest Fiancee.
Quite surprised you are saying don't confront him - torn now whether to say anything or not - could it all be an I.R./accounting cock-up? Am I being niave?
She is in the pub trade - are there any honest landlords!?! Suppose that's like asking are there any sober ones
Cheers, Phil
My clumsy post was trying to hide the fact the has happened to my utterly honest Fiancee.
Quite surprised you are saying don't confront him - torn now whether to say anything or not - could it all be an I.R./accounting cock-up? Am I being niave?
She is in the pub trade - are there any honest landlords!?! Suppose that's like asking are there any sober ones
Cheers, Phil
Quite surprised you are saying don't confront him - torn now whether to say anything or not - could it all be an I.R./accounting cock-up? Am I being niave?
Possibly!
Pub trade - even better, IR will probably inform Customs & Excise now these people dont FCUK about.
Find the missus another job quick smart and start flinging some muck.
edited to add: confronting him will forewarn him, He has tried to FCUK your missus over. drop him in a whole world of mire so that when he is confronted he has no 'ready' excuse.
>> Edited by Marcos maniac on Wednesday 12th February 15:27
Please ignore the "advice" offered by Ninja Eli re "Self Employment". He is trying to "second guess" what her employer is going to offer in the way of an explanation to the Inland Revenue. Whether he claims she is self employed or not is totally irrelevant. She was hired as an employee, the circumstances of her "employment" have not changed and she has not been formally dismissed as an employee - therefore she is still an employee. The employer is still legally obliged to deduct tax and NI from her wages.
My hunch is that he is paying her out of cash takings and supressing an equivalent amount of cash sales. This is not unusual practice in the pub trade and extremely illegal. It annoys not just the Inland Revenue and HM Customs and Excise, but it may upset the brewry or owners of the pub, unless the manager doing the creaming off of takings is also the owner.
I would not personally confront the pub landlord/owner/manager. There is not much you could achieve except maybe extreme unpleasentness. Get your girlfriend to resign her job and find a new one (easier said than done sometimes I know). As advised by Marcos Maniac, just leave quietly, obtain a P45 and present this to your new employer. If the current employer is reluctant to complete a P45 (which he may very well be - this is also illegal), complete a Form P46 when you join your new employer.
If you want to inform the Inland Revenue about the employer's behaviour, you can of course do so but just be careful that such news does not work its way back to the errant employer as he may not be in an appreciative mood.
>> Edited by Eric Mc on Wednesday 12th February 17:05
My hunch is that he is paying her out of cash takings and supressing an equivalent amount of cash sales. This is not unusual practice in the pub trade and extremely illegal. It annoys not just the Inland Revenue and HM Customs and Excise, but it may upset the brewry or owners of the pub, unless the manager doing the creaming off of takings is also the owner.
I would not personally confront the pub landlord/owner/manager. There is not much you could achieve except maybe extreme unpleasentness. Get your girlfriend to resign her job and find a new one (easier said than done sometimes I know). As advised by Marcos Maniac, just leave quietly, obtain a P45 and present this to your new employer. If the current employer is reluctant to complete a P45 (which he may very well be - this is also illegal), complete a Form P46 when you join your new employer.
If you want to inform the Inland Revenue about the employer's behaviour, you can of course do so but just be careful that such news does not work its way back to the errant employer as he may not be in an appreciative mood.
>> Edited by Eric Mc on Wednesday 12th February 17:05
Eric Mc said: Please ignore the "advice" offered by Ninja Eli re "Self Employment". He is trying to "second guess" what her employer is going to offer in the way of an explanation to the Inland Revenue. Whether he claims she is self employed or not is totally irrelevant. She was hired as an employee, the circumstances of her "employment" have not changed and she has not been formally dismissed as an employee - therefore she is still an employee. The employer is still legally obliged to deduct tax and NI from her wages.
Errrr, what is it you think I was saying????
I think it is wise that he should know what they might be trying to do. Having dealt with these scenarios before, I know it is a common attempt. Also, the Inland Revenue are notorious dumb when you are trying to resolve such a situation, so knowing what they are on about might help.
I don't understand what it is you think you have said different to me? Read it again mate. I made it explicitly clear that it is their problem not hers, they are considered to be collectors of taxes and as such they are responsible. They will also be in a lot of trouble due to the position of trust that they are in collecting Govt's funds.
My hunch is that he is paying her out of cash takings and supressing an equivalent amount of cash sales. This is not unusual practice in the pub trade and extremely illegal. It annoys not just the Inland Revenue and HM Customs and Excise, but it may upset the brewry or owners of the pub, unless the manager doing the creaming off of takings is also the owner.
You also missed the fact that she is being paid by cheque, so it's not a case of suppressing cash sales, which in fact would be more useful to pay against his own drawings hence reducing his own personal tax liability. It is easier to claim payment to a self employed contractor than to reduce your own tax liability.
Good luck with the reading.
I agree your point on the payment by cheque issue. I know I need new reading glasses.
The Inland Revenue do not recognise many payments to pub "staff" that might be considered to be self employment. The only area might be a perpathetic chef. He would probably try to disguise the payment as something else entirely, like "Purchases" or "Repairs".
The Inland Revenue do not recognise many payments to pub "staff" that might be considered to be self employment. The only area might be a perpathetic chef. He would probably try to disguise the payment as something else entirely, like "Purchases" or "Repairs".
Again thanks all. Please don't fight over me though 
And, yes, she is a chef.
Whether she should appreciate being called 'perpathetic' I am not sure, as it's not in my dictionary
The landlord is also owner of the establishemnt lock, stock etc. Fiancee is on leave for a week, when she goes in to collect her wages she is going to casually mention she would like wageslips, or failing that a contract, *may* mention that I.R. are asking 'cos of the previous dodgy employer.
I don't *think* he could pull the contractor stunt, as the net amounts on the cheques have not changed from official employment to the 'grey' area, and it's not a round number ie £XXX.37
Also there are 15 other people working there, mainly part time, and she is now convinced most are not on the books.
Side issue: His name is on the license, but so is a person that is now deceased (over 2 years) - this sounds VERY dodgy to me. This should not be possible?
Thanks again, Phil (and a much happier Fiancee)
Editted to correct shameful spelling, and then to say that looks when I make it a a PH event, I shall be buying a big round of pints
>> Edited by filmidget on Wednesday 12th February 18:16
>> Edited by filmidget on Wednesday 12th February 18:18
And, yes, she is a chef.
Whether she should appreciate being called 'perpathetic' I am not sure, as it's not in my dictionary
The landlord is also owner of the establishemnt lock, stock etc. Fiancee is on leave for a week, when she goes in to collect her wages she is going to casually mention she would like wageslips, or failing that a contract, *may* mention that I.R. are asking 'cos of the previous dodgy employer.
I don't *think* he could pull the contractor stunt, as the net amounts on the cheques have not changed from official employment to the 'grey' area, and it's not a round number ie £XXX.37
Also there are 15 other people working there, mainly part time, and she is now convinced most are not on the books.
Side issue: His name is on the license, but so is a person that is now deceased (over 2 years) - this sounds VERY dodgy to me. This should not be possible?
Thanks again, Phil (and a much happier Fiancee)
Editted to correct shameful spelling, and then to say that looks when I make it a a PH event, I shall be buying a big round of pints
>> Edited by filmidget on Wednesday 12th February 18:16
>> Edited by filmidget on Wednesday 12th February 18:18
I think I'll be needing glasses soon too, its all to do with PH I tell you!!
Dom's classic quote "you can spot the PHers due to glazed eyes". So true.
I agree with you regards I.R. view on self employed in Brewery scenario, but as you have already stated, some employer's try different classification of expenses, even for the same employee. I've seen guys listing the employee for part of his salary as being "waste disposal", another part "cleaning", another "distribution expenses", "consultancy fees", "sundry expenses", and so on. A lot of these people don't register companies "properly" either, and it can take a while to properly investigate.
My eyes hurt, I'm off home now
My previous post might have been a little strong, it's just that I couldn't see where we were conflicting. Bye
Dom's classic quote "you can spot the PHers due to glazed eyes". So true. I agree with you regards I.R. view on self employed in Brewery scenario, but as you have already stated, some employer's try different classification of expenses, even for the same employee. I've seen guys listing the employee for part of his salary as being "waste disposal", another part "cleaning", another "distribution expenses", "consultancy fees", "sundry expenses", and so on. A lot of these people don't register companies "properly" either, and it can take a while to properly investigate.
My eyes hurt, I'm off home now
My previous post might have been a little strong, it's just that I couldn't see where we were conflicting. Bye
No animosity intended Ninja.
The word should have been "Peripathetic" which meams "travelling". So - if she "Chefed" in other pubs or resteraunts she might, just about, be able to claim she was self-employed but it would be a risky course of action. I had a pub client who actually asked me this once about his Chef who actually WANTED to be treated as Self Employed. I advised my client to put him on the payroll, which he did.
The word should have been "Peripathetic" which meams "travelling". So - if she "Chefed" in other pubs or resteraunts she might, just about, be able to claim she was self-employed but it would be a risky course of action. I had a pub client who actually asked me this once about his Chef who actually WANTED to be treated as Self Employed. I advised my client to put him on the payroll, which he did.
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