Private tutor not paying tax??

[Sudburyswan]

Hi,

we use a private tutor for our son -just an hour per week. A nice guy who works at a local secondary school. He also tutors some friends kids and I’d estimate he’s earning £100 during term time on top of his teaching salary.

When he was here last weekend I was working in my tax return and I was moaning!! He made the comment “ I’m glad I don’t have to do that”- well surely he should be?

I know he’ll get the £1000 trading allowance but I still reckon he’s got 3-4 k of potential undeclared income. We pay him by bank transfer too.

I’m in two minds whether to report this.

surely hmrc’s systems will pick up this money entering his account??

How petty and pathetic

Jesus, do you not have enough going on in your life?

Because small business make up 60% of the unpaid tax in this country, and wealthy individuals make up 5%. So if we collected all the tax from wealthy people, large and mid size businesses and criminals (eg drug dealers), then we still wouldn’t have managed to collect half of the unpaid tax. The problem really is these people who think they should be able to get away with not paying their tax because they don’t earn very much. It’s illegal and we shouldn’t stand for it.

As it happens, wealthy people, on the whole, spend a lot of money to get their tax affairs correct and so make up a very small part of the tax that goes unpaid in this country. I know, it’s my job.

This! You sound like someone who gets off on the misery of others! Trust me he’s paying plenty of tax on his main job.

Go on then... report him. It'll take you an hour on the phone with HMRC at the moment, and I'd love to hear how you plan on doing it? "I heard my child's really decent tutor say he....errrr..... wibble wibble".

Truly shocked the number of people totally unbothered by people not paying tax on secondary income.

Firstly, no I wouldn't report him because you really don't know whether his comment meant he wasn't declaring the income or because of another reason (it's done for him by an accountant / already done, etc etc). I think it's just too much of an overstep.

Secondly, the cash economy collectively deprives the state of a huge amount of money. Yes, big corps should be the goverment's target. But everyone has a responsibility to do their bit. Like climate change, you can't just say 'it's only little old me'. You have a moral (and of course legal) obligation to pay tax when it is due. It's part of trying to live fairly in society. Just because it's not taken at source like PAYE doesn't mean it's optional. Just because you already pay some tax, doesn't mean you shouldn't pay more if it is due.

Thirdly - those getting confused by VAT. We're talking income tax here, which is of course a totally different tax.

Mind your own business. You don’t know for sure how many people he tutors or what he’s earning and it really is none of your business.

If you report him then he'll just pass the extra tax on to his students like your ds.
Or are you finished with tutoring and happy to see others not able to afford what you had?

Jesus Christ. Get a life

Well yes, valiant point, but substitute NHS for schools or social care which are less money holes and more just underfunded and it might help.

But it is all of our circus. What other crimes do you think aren’t worth reporting? Benefit fraud? Shoplifting? Burglary? Muggings? Or do you only care if they’re committed against you personally?

How can you report what you don't know?

You know what you pay him BUT you only "reckon" he's got some other pupils and you do NOT know what he's charging those parents.

It could all come under the £1,000 threshold.

Mind your own business.

If he’s earning below a certain threshold, he might not need to file a tax return—maybe that’s all he meant.

Do you even know how much he makes? Do you know his exact schedule or how many kids he tutors? You can’t possibly say with certainty what his income is.

Honestly, if an off cuff comment like that bothers you so much just change the tutor and move on. If you’re so concerned about tax evasion, why not go after the corporations avoiding millions.

May I ask roughly how much it costs to have an accountant submit it for you? I'm hoping to do this next year.

Then you haven’t seen the figures. 60% is from small business. 5% is for the wealthy.

https://www.gov.uk/government/statistics/measuring-tax-gaps/1-tax-gaps-summary#tax-gap-by-customer-group

Personally wouldn't report him.

I also thought that HMRC would have systems to detect this sort of thing though - especially if money is going into his bank account? Is this not flagged by software?

There is no need for you to report him. It's quite easy for tax-dodging self-employed people to get noticed and audited by HMRC.

For example from the self-employment I do, I often need to send invoices and receipts to clients. Those clients sometimes are subject to HRMC checks where they (or their accountant) have to send everything in, including my invoices/receipts etc with all my personal details on. HRMC then check me out to make sure I'm paying tax.

So I'm sure if he's not doing the right thing, he'll be caught up with.

Hilarious OP is outraged enough to report but happy to continue to use him knowing he’s not paying tax
in short you ether have principles or u don’t

I think it was in Bloomberg and then OBR wrote about it, much of it comes from trade having tanked by 15% when it should have increased instead. The loss of taxes generated by trade (the customs tariffs, VAT, corporation taxes) and the loss of jobs (and the individual taxes paid) caused by the loss of trade amounted to more than the £40bn number. I will try and find it, I think it was published last spring.

You don't have to register if you don't meet the VAT threshold anyway

@bravefox and @Feelingstrange2 No-one is talking about VAT. The issue is income tax

But it’s HMRC’s job to catch tax evaders out not that of some busybody.

If the tutor is not paying tax he’s taking a big risk being caught by HMRC. Not something I would do but it’s his risk to take.

Also think about it practically, let’s assume the tutor earns £5k a year tutoring, doesn’t declare it, and is a 40% taxpayer. So underpaying by £2k.

How many telephone operators do you want HMRC to employ to take note of one comment made in passing, could have been misheard or misinterpreted. How many tax inspectors do you want conducting investigations for this trivial nonsense, lots of which will amount to nothing. You’ll easily rack up more in costs than you’ll recover.

Ultimately in depends on what you think HMRC’s job should be - investigating everyone on a point of principle or recognising that they’re never going to receive 100% of what they should so they should aim to get as close to that as possible? So target the investigations against the people/companies they can recover the most money from?

Why?
I'm self employed, it's really very easy to do it all yourself, do cash basis accounting, keep your records, add up your totals, then spend 20 mins on government gateway putting them on the form and pay the bill - easy.

Waiting for the thread in a couple of months time, ' AIBU to think my child's tutor is taking advantage of us, by unexpectedly raising his prices'.

No definitely not because then all the tens of thousands of kids at state schools who use tutors would have to pay and we like them, we just don’t like private schools because envy…