Electrician demanding cash payment - how to handle?

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Hi

I was recommended an electrician as needed old halogen spot lights switching to LEDs. I got a quote verbally and we agreed. He finished the job yesterday and fucked up my sink in the process due the debris. He said he’d be back on Friday to fix it and wanted cash payment. I said we never agreed that and I want a proper invoice first. He then muttered something about VAT (I will only pay what we agreed as I assumed vat was included). I’m a single parent and feel a bit worried about challenging him on this. He is doing some work for a neighbour too. Any advice?

My DH is self employed. His customers have the option of bank transfer, cheque or cash so up to them. It all gets recorded in his books.

He prefers bank transfer!

Alas, workmen always want cash...

No, they don't.

All you need to say is, "I don't carry or keep large sums of cash in the house. What are your bank details?".

For God’s sake just give him the cash.

he can only charge vat if he is vat registered - its him not declaring his earning to HMRC

I used to pay cash. After a bodged job, for which I had no comeback, I insist on having paperwork.

I also had the patio repaved, and after the work was done I said I'd pay half in cash, half cheque. (We had not agreed any payment method in advance.) The guy turned really nasty and shouted and said he'd go with me to the cashpoint to make me get the money out. He won as I was a bit afraid.

Just pay him but insist on an invoice.
I run a property maintenance business. We turn over an average of £900 per week so are not VAT registered yet.
I hate cash payments but the customers insist (with a nod and a wink). All cash is deposited in to the bank account and recorded in our accounts. We much prefer a bank transfer or credit/debit card payment.
At least with cash we know we have been paid. It's the people in the more affluent areas who mess us about and don't pay immediately. I have an overdue payment of £500 from February that I am about to start the debt collection route on.
I had to put a director's loan in to the business recently because a customer took two months to pay after the work was completed. She was very happy with the work as well and wants us back to do another large project. We are actively trying to avoid her now.
I find it really offensive that some of you assume we are scam artists because we are not VAT registered. It's difficult to earn the money when you go out to quote and potential clients pull their faces because we charge £250 a day labour for a highly skilled carpenter and his assistant. They want the job doing for the price of the materials only.

No, they don't.

The tradesmen we use prefer bank transfer. Some explicitly say they don't want cash.

I think the only cash payment we make is to the window cleaner.

I always pay tradespeople cash if that’s what they want. It’s not a big deal just ask for an invoice marked ‘paid’

I always pay tradespeople cash if that’s what they want. It’s not a big deal just ask for an invoice marked ‘paid’

That's when the unscrupulous ones say they'll have to add VAT if you want an invoice.

I'd just pay him cash to be honest. Although anyone who has ever done building work for me has wanted paying by bank transfer.

Even getting cash is hard. A couple of years ago I needed £6k in cash and went to the bank and they didn't have enough! High street branch of a big name bank. They sent me to another branch and told me in future if I wanted to make a large cash withdrawal they preferred 48hours notice.

I'd always assumed "large" was walking in and asking for £100k not the sort of sums people routinely spend on cars/holidays/jewellery etc.

I'd always assumed "large" was walking in and asking for £100k not the sort of sums people routinely spend on cars/holidays/jewellery etc.

But most people don't pay for expensive cars, holiday & jewllery in cash.

Ask for an invoice and a receipt. Pay him in cash. Don't always assume that cash won't be declared by sole traders, my dh is a sole trader and he declares every penny.

My DH is self employed and often gets paid in cash as its easier to physically have payment there and then. It then gets taken to the bank and pay it in where the VAT is paid, NI, etc etc.

Its a right pain trying to money launder these days, you just can't do it. Any payment in over 4k has a lot of questions and is reported to HMRC, any payment out is also met with questions. So quite rightly the rules are very tight and difficult to make it worth doing.

Pay cash, ask for an invoice marked paid. Job done, no drama.

I don't do online banking so can't do transfers easily, and understandably tradesmen do not want cheques.

Thank you all so much! So he said "I didn't add VAT" when I asked for an invoice. His price was on par with others and not cheaper. My issue is more if something goes wrong with the electrics, I'll have no recourse. It is my own fault really. Before he came, I asked for his full company details and he just gave me his name (which I checked on the NICIEC website and he is fully qualified to carry out the work - puts my mind at ease somewhat).

My issue is more if something goes wrong with the electrics, I'll have no recourse.

You are right to worry. Not only if something goes wrong, but also to prove the work was done properly if you come to sell your house. Buyers (and their solicitors) often want proof that "regulated" work has been done professionally by workers allowed to do it, and I think kitchens are one of the areas where electrical work can't be done by none qualified electricians. Without an invoice, you'll struggle to satisfy that regulations have been complied with which may put off a buyer or they may want an inspection and/or indemnity at your cost.

Half my customers are suspicious that we take cash. The other half want to give you cash with a nod and a wink asking for 20% off...(err, no)

In fact the only customers of ours who are VAT free are occasional American airforce staff who have to produce a US goverment certificate and payment, which is raised on receipt of a quote... All above board, and legal I will add before anyone jumps on that.

Some businesses really don't cheat the system, pay the correct amount of tax AND don't have teams of accountants finding the most tax 'efficient' way of doing business.

Some businesses really don't cheat the system

Exactly - the ones who happily quote properly (clearly showing VAT if applicable) and happy to give proper invoices.

All you need to say is, "I don't carry or keep large sums of cash in the house. What are your bank details?".

Any experienced tradesperson should have their T&Cs on the estimate/quote agreed in writing before starting the job. Including terms of payment.

@theworldistoosmall tax avoidance is very rare in big business especially since the amazon/Starbucks fiascos. Big Businesses are very keen to look like they are paying enough tax even if it means pay more than they need to. Most seek independent tax advice from big name firms who have an anti avoidance stance. And of course many of them are audited as well. Obviously they tax plan (although usually less than they could) but these days it’s rare to see avoidance. Opportunities for avoidance are also very rare now, HMRC have closed most loopholes in recent years. Small business on the other hand are rife with outright evasion,

@Iwant2move there is no minimum threshold to register for VAT, you can always register if you want to.

My neighbor had the same story, he called an electrician without a license, because it's cheaper, and in the end, this electrician burned all his wiring.

I don't pay cash any more and Covid gives you the perfect cover story for not using it.

But all recent workmen have been completely straight and reasonable about expecting me to pay by bank transfer. So, yes, I would be very alert to someone insisting on cash these days.