Reply With QuoteYup.Originally Posted by Montello
Again we’re just getting examples of JPCain’s mates gaming the system. Rather than just going round and round in circles on here do us all a favour and report them, please!
Claiming back input VAT is standard on business purchases? What’s the problem?
I suspect your saying they claim back input vat on non business purchases which of course is fraud. Report them to HMRC.
Yup.
Again we’re just getting examples of JPCain’s mates gaming the system. Rather than just going round and round in circles on here do us all a favour and report them, please!
If I pay for a customer's lunch then I ask for the receipt and it is put into the accounts.
However no VAT is reclaimed on it and it does not benefit the company against corporation tax. The receipt is merely used to show where the money has gone.
So whilst it may seem people are fiddling their accounts they could well not be.
I'm only going round and round in circles because people asking.
I won't report people for claiming back the VAT on their coffees haha. I'm pretty sure the HMRC would laugh at me for wasting my time.
Is it classed as fraud. I mean these are drinks and food whilst at work. They may class it as business needs.
Just for clarity. If I was self employed I would do the same.
Could be true in some cases. These cases are to claim the VAT back.
the irish government were very fair paying 350 euro to self employed people. and we didnt have to jump through hoops to get it. its for 12 weeks to get us over this.
I’m self employed and I never bother claiming/expensing drinks or sarnys it’s not worth the time, better to use the time for something that creates income.
I can’t believe you are getting yourself in knots over this, they are probably just winding you up.
I think they just chuck everything over to an accountant.
I really have nothing better to do at the moment.
If these are the same mates that are paying £0 tax on £80k earnings then the taxman would LOVE to hear from you, and you’d be doing the rest of us a big favour too.
Well there obviously not are they. I have more than one friend.
The one who paid £0 tax closed down his business and set up a new one. I'm sure you will jump down my throat for not sharing the right terminology or if I was out by a percentage but yes he paid zero tax.
Why would they claim the 20% tax back if they are paying £0 tax.
I am literally responding to questions (or in some cases digs). I haven't dug anyone out I have just given my experience on why people think self employed pay less tax and since then I have been dug out and I have responded accordingly.
People have said its just my fraudulent friends that do this. I dont think it is but I cant back it up. I know if I was a contractor I would be looking to save on paying as much tax as possible.
Last edited by JPCain86; 13th April 2020 at 13:20.
Having worked in the field of taxes, my experience is that the majority of anecdotal stories are at least partially inaccurate (intentionally or otherwise) and 'what a mate' or 'bloke in the pub' says is rarely reliable and/or the full story.
As suggested, if you genuinely suspect anyone of (significant) tax fraud then tell them they could face prosecution for a criminal offence and do us all a favour by reporting them to HMRC. It's not 'playing the game', it's stealing from us all and morally bankrupt. Whilst the majority would face a civil settlement, HMRC are increasing criminal prosecution case numbers and I'd expect to see more, along with harsher civil penalties, going forward.
Sent from my HD1903 using Tapatalk
Serious questions. If you have been negatively affected by the latest Government policy, what will you do differently in both your working life and personal life in regards to finance? For instance, I have noticed mention of paying yourself dividends, which have little tax advantage over PAYE apparently, so that you can only take enough out of the business as it can afford, and be able to leave money in the business to invest in future growths and day to day running costs. Will you in future pay yourself variable monthly payments under PAYE, so that you will be able to leave money in the business to invest in future growths and day to day running costs?
I am talking about close friends here not blokes in the pub. I certainly wont be telling the HMRC for. As for people at work claiming back their coffees, I couldnt tell on them as I cant say I wouldnt do it in their position.
Have you ever run a business? LTD or otherwise? Dealt with accounting and Vat?
Or is it just your ‘mate’s’ pub anecdotes?
FYI vat is reclaimable on food/drinks if it’s hot and in certain situations where you are away working on location and not within reach of home, so when on a multi day location shoot I will claim the vat on hot meals for crew (and then only if it’s easily shown on the invoice) when in the studio I have claimed the vat back on certain food and alcohol products that are used as props and then binned but not the shoot subsistence that is eaten.
I do this because like a lot of people I’m not into fraud and if/when I get a picked for a VAT audit I want to come out of it smelling of roses.
Not everyone is like your mates and on the take all the time, most like to sleep at night.
These are close, close mates. Not blokes in the pub. But I do know colleagues at work who base their office at home and claim for all hot drinks etc. Im not saying they will get them through, I couldnt say.
But yes my friends claim for as much as they can get away with (or think they can).
No don’t worry I won’t be - I got fed up before because your calculations in comparing PAYE to ltd company tax affairs were completely wrong, which (I think) you finally understood. The rest of this is just about tax and VAT evasion, which we’re in agreement about. Crack on fella
Not sure what your point is then other than some vague concerns about uncertain scenarios regarding your mates and work colleagues.
The reality is that the majority of s/e pay the tax they are due to pay, some will claim a few expenses to which they are not entitled or undertake the odd 'cash job' but for most the sums involved are quite minor.
There are valid reasons why someone making £80k profits pa might pay zero tax, including losses and other reliefs, but the most likely explanation is that it's not factually correct. Contractors who have had tax deducted at source often refer to getting a repayment at the year end but they still have a tax liability.
I suggest the topic be allowed to return to the original heading and I'm going to finish my paperwork before getting out on the bike.
Sent from my HD1903 using Tapatalk
My initial point was purely to share my experience with contractors. I wasn't saying all contractors do this, but sharing my personal experience and why the common perception might be that they pay less tax. I imagine there are other people similar to my friends who also avoid paying as much tax as they can, as I would suggest why this has become a common perception and not just an urban legend of a few dodgy contractors from Rotherham who managed to get away with paying their taxes.
I shared it because I thought it was relevant at the time.
I definitely got some figures wrong at the time and I accept that.
The mate who paid £0 on his £80k income, literally folded his business as he was starting to work for a new client and didn't want to pay the tax. He didn't pay the tax and went on Holiday instead. So the general consensus seems to be my friends are crooks. Do I plan to tell on them? No. Do I care? Not really? Are they still my close friends that I hold in high regard? absolutely.
My point was to share on the reason why I think there is this perception, that is all.
I think you need to find some better friends then, I’m not keen on sharing a beer with frauds.
Seriously, you've pretty much singlehandedly destroyed the thread - 37 posts, none of which are relevant. Just leave it for those to whom the original subject is important.
Really good friends. I have no issue with what they do.
Its not like they drink drive or anything like that.
I think the 1st part of this is a relevant question.
Would be interested to hear people's thoughts .
Sent from my moto g(7) power using Tapatalk
Seriously whats your problem. I bet you have posted 25+ times and added nothing of great relevance.
The OP just opened a thread and which was the catalyst for a discussion. He didn't ask a question.
What is the OP looking for? Help from the Government? This seems to show that https://www.crunch.co.uk/knowledge/r...self-employed/
Or maybe he wanted a discussion and a chat at times where for some that is all we can do.
There will be many honest self employed tax payers who will seriously consider putting more through as cash probably after this. There will be others who will consider setting up as a limited company. Others will no doubt carry on with no change but maybe put a little more aside each month as a disaster recovery fund. Each to their own I guess ...
I think it's become a very pertinent question. I'll certainly be speaking to my accountants about it and may will try to do similarly with someone within the FSB as well. Sadly, it does look like the present support ship has well and truly sailed for a proportion of us, which I'll say yet again I find pretty inequitable all things considered.
Oh, then why bang on about them here? Great bunch of blokes defrauding the HMRC leaving public services, like the NHS, under funded. Top lads ...
Well. I can't comment to say they are defrauding anyone. They claim a lot of things but I can't say what is illegal what they claim for I'm afraid.
Morally wrong maybe but I can deal with that and still call these guys my friends.
I cannot see us doing anything different. We have a low, I personally have a very low PAYE (due to a military pension in payment) each month. We do this because it means that at the end of the financial year we can evaluate our year, choosing at that point exactly how much to take from the business, pay into pensions, possibly even not take from the business. This lockdown has actually come for us at the very worst point in the calendar that it could have. Almost all of our income arrives into our bank. from April to Oct. Oct to April we build stock and invest in our business. Therefore in March our bank accounts are at their lowest point of the year.
We would however (I think) not take any more in PAYE, as that would impinge on our ability to use that same cash in the business, as and when we need/want to during the year.
Nothing is certain in life apart from death and taxes.
I’ll be honest though, with staff to care for, as well as our own personal position, it’s difficult not to be just a little stressed at the moment
Sent from my iPhone using TZ-UK mobile app
There are some valid points re cash flow but there is nothing stopping you introducing money into the business after it has been withdrawn and taxed.
Whilst this thread includes comments comparing tax rates between Ltd Co. and PAYE suggesting a limited differential, the main benefit of dividends comes from no NICs being payable.
I don't have an example to hand but in recent years taking the bulk of £80k profits via dividends compared to salary meant the Exchequer received c£8k less.
Last edited by deepreddave; 13th April 2020 at 18:53.
Noted and thank you, food for thought
Indeed. In be essence I'm agreeing that changing your taxes strategy to factor in potentially benefiting from any similar Govt Grant scheme in future seems excessive. Assuming we don't anticipate this being a regular occurrence!
Sent from my HD1903 using Tapatalk
I pay a lot more than the minimum amount as salary, and then an amount based on profits.
I pay, NI, Employers NI, pass over VAT on every invoice raised, accountancy fees, company return fees; have to take time preparing accounts, preparing invoices, dealing with late payers or non-payers, insurance, PII. The list can be quite extensive - and all because what, I can save a little in tax?
If I pay three times more than someone else in tax, and find myself in a position where I can’t work, because my government has made some decisions (rightly or wrongly, even if for the public good), then I honestly feel that there should be some form of help.
Who is going to be raising all the future tax revenue if all these similar businesses fail? Because we are not all super rich, or with no expenses, that can life off savings, until this is left in the history books.
Last edited by Omegamanic; 13th April 2020 at 20:02.
It's just a matter of time...
Well........... this has been fun to watch
Yes, in that the comparison includes employee and employer NIC due on full salary. I recall PAYE totalled c£31k tax/NIC whereas CT and tax on the dividend was c£23k, if a small salary was taken to qualify for state pension. That was c3 years ago so the figures will be slightly different now.
Sent from my HD1903 using Tapatalk
Agree 100%
Genuine question but do you guys need the £5,400 to get by over the next 3 months?
I mean I don't know anyones situation here. I always has Tony down as some kind of millionaire simply because he has some of the nicest watches on here.
Is it more that you feel the government are screwing you over because your self employed. Not that there's anything wrong with that. I've felt screwed loads of times by the government.
I mean would people still want this money if it was an interest free loan?
Thankfully I don’t. But a lot of limited company directors will and it’s deeply unfair there’s no decent level of support available to them. From what you’ve learnt from this thread I hope you now feel the same
Not sure I follow.
I was talking more around personal circumstances. I mean you could work at McDonalds on minimum wage but be fairly well off with lots of cash in the bank.
I am yet to rely on any funding. The company k work for still has me working although we have furloughed a few while being no less busy then we were. So workload and stress levels have gone up.
I'm not so much worried about the 3 months and the £1800 a month the govt will offer. More so the state of the economy when we get through this.
I know three people who have very profitable business and wrk out of small units, they all got a ten grand gift from the government last week, non of them needed it.
I'm sure HMRC investigations unit are going to be very very busy for the next few years, and they can go back through 20 years of accounts for serious offenders.
Ye. I know a hairdresser that got the same.
Sorry I thought this thread was about support (or lack of) for the self employed? I’ve read your response a couple of times and I must admit I’m not exactly sure what you’re getting at to be honest.
However I am sorry to hear you’ve got more work on but I guess 1) you still have a job and 2) if you are furloughed you will keep your job and still get something half decent to live on. Many of us here don’t have that to fall back on if we needed it.
^^^
This will be the issue withe the £10k/£25k grants. As you say there will be profitable out there that do not need the money, but will take it. Suppose it depends on ones moral compass...
I suppose it will also depend on how creative accountants have been advising business in their set up...
This.100%.
It's not a competition. I was purely stating that I don't know what my situation would be.
I totally disagree. Anyone who thinks that they will have a job in 6 months because they are working now is very naive. I was just stating my fears.
I really don't get this anyone else posts a comment around anything other than support for the self employed and it's fine. I do and your on me. You all win. I won't post on this thread again.
Tip for you deanlad. Don't use creative accounts as a reference.
Eh? I’m not ‘on you’ in the slightest. I’m pleased you still have a job and sincerely hope that continues. All I’m saying is that if it doesn’t you have a guaranteed and immediate fall back position courtesy of the government (and tax we all pay) which isn’t true for everyone. And that to me is unfair.
Believe me I’m not on you. You posed a question and I answered. I shouldn’t have bothered though that much is true.
Don’t worry, no fear of that. The accountant I have is more like a book keeper.
I genuinely wonder what he does that makes me have some eye watering returns based on the earnings I have.
I clearly need more lunches.
Thought id better reply to this as i am the op
My point was the injustice in the way self employed people earning over 50k are being treated compared to people on paye
I am not self employed myself i run a medium size ltd company with 30 odd employees
There seems a lot of back stabbing at self employed and company directors occurring on this thread
With respect self employed and company directors are part of the backbone of this country we take massive risks and have massive stresses running our businesses
Its easy for people in there comfy paye jobs or final salary pension to criticise when the biggest risk they ever take is wether to take sugar in there tea or not
Sent from my iPad using Tapatalk
Posting Permissions
