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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Tax. AIBU to feel angry and hurt.

68 replies

Fairysnuff321 · 19/04/2017 19:49

I can't be sure about this as I didn't hear it directly, but....
We were discussing finances being tight and my firiend husband mentioned that my other friends husband boasted to him that they run their business totally off the books and pay NO Tax, NONE, nothing.
I feel sick, and hurt, as the wife of Tax free boasting man, was I thought a good friend.
I believe in taxation and would rather have less and live in a society that looks after the sick, the old, and educates they young. The idea they are swanning off on holiday, while everyone else is paying for their healthcare, education etc leaves me struggling to respect them at all.
As it is second hand info I can't be sure .... but how the hell do I bring this up? If I don't it'll poison how I feel anyway.
I feel devastated.

OP posts:
AppleOfMyEye10 · 19/04/2017 20:37

I would work in your emotions before you do anything else.

This. You sound way over the top dramatic. Something's not right with you.

Crapuccino · 19/04/2017 20:39

I'm not sure I'd be devastated. Disgusted, maybe, and even contemptuous, but I don't think I'd take it personally unless it was my actual DH who had done such a thing. PPs have good advice. Report to HMRC and let them step in. Note though that the wheels turn slooooowly so you won't see the fuzz kicking their door down tomorrow.

LovingLola · 19/04/2017 20:52

Tax avoidance is not a crime.
Tax evasion is.

Buck3t · 19/04/2017 20:53

I'd feel the same as you. I'm forever lecturing a girl at work about paying her TV licence. She had a TV but it didn't work. Now it only works if her door is open (very funny when she showed us the video).

Bunnyfuller · 19/04/2017 21:01

Shop them. HMRC will be able to decide if there's anything amiss. Cannot abide tax evasion.

IfYouGoDownToTheWoodsToday · 19/04/2017 21:06

What does "run the business totally off the books" mean?Confused

RainbowsAndUnicorn · 19/04/2017 21:07

I'd imagine there are thousands, if not millions of people, who don't pay any tax but use healthcare, schools etc.

Report your friends by all means but if you cut them out for this then you are saying you are only friends with people whose pay slip shows they pay tax based on your OP.

Crapuccino · 19/04/2017 21:18

IfYouGoDownToTheWoodsToday: What does "run the business totally off the books" mean? Confused

Imagine you're a hairdresser. Ten people walk in and get their hair cut. You take the money, pay your staff cash in hand, and put the remainder in your pocket. In your books, you write down "zero appointments today". The actual money taken is kept off the books.

Very easy to do in cash-payment type industries like takeaways, beauty salons, garages, and so on. Harder to do in businesses that take card payments, because that leaves an electronic trail but certainly not impossible.

Ta1kinPeace · 19/04/2017 21:19

ifyougodown
It means that they do not declare any of their income.

Builders taking cash in hand
Pubs not ringing sales through the till
Market traders taking cash and paying cash and not banking anything

Deadsouls · 19/04/2017 21:21

Why devastated? Also what you've heard is hearsay, I wouldn't go on the word of second hand news, you'd have to find out directly somehow to see if this were true before you took any action, if you are going to.

SuburbanCrofter · 19/04/2017 21:23

For the PP who said that almost everyone they know who is self employed pays very little tax - well I'm self employed and, unfortunately, I pay a shed-load! Grin

I can't see how self employed people bringing in 'six figure sums' would pay no tax by making everything tax deductible. The current tax-free allowance is £11k, so someone on (say) £100,000 would have to claim £89,000 in expenses to pay no tax. Apparently HMRC track tax returns to check for anomalies so this would certainly be flagged up.

I think there's a small possibility that these people might be bullshitting about their tax-dodging efforts...

Storminateapot · 19/04/2017 21:29

Absolutely Suburban - HMRC do have certain limits that they would expect as a % of turnover to be deducted in expenses for each type of business. Anything outside that range is flagged for checking,

Ta1kinPeace · 19/04/2017 21:31

Apparently HMRC track tax returns to check for anomalies so this would certainly be flagged up.
Not apparently
They have well designed analytical review tools
I have a copy of their standard tables (acquired it over 20 years ago)

IfYouGoDownToTheWoodsToday · 19/04/2017 21:37

Thank you Crapuccino

I know quite a few people who seem to do that, my hairdresser, builder, gardener and window cleaner all prefer cash.Hmm It really pisses me off tbh.

We own our own business and are 100% honest.

IvorHughJarrs · 19/04/2017 21:44

Surely the key phrase here is "off the books" which suggests illegal practice rather than claiming legitimate expenses and write-offs. If you think it is true then report it

A friend of ours was recently made to pay almost £200k in unpaid tax after someone reported his business. It genuinely wasn't me, I was shocked to hear it but left him in no doubt that I disapproved of tax evasion and would have reported him had I known

ShelaghTurner · 19/04/2017 21:48

Was going to say, we have a tiny family business and pay a bloody fortune in tax. To the point where we're completely skint. Our accountant must be shit.

Ta1kinPeace · 19/04/2017 21:55

Change accountant then.
There are lots of us about.

Original poster
Fairysnuff321 · 19/04/2017 21:56

Bodicea - it has really knocked me, this is someone who was a close friend. Her friendship is important to me and I would feel personally deceived. Maybe you think I'm soft, but this shit is important to me, and so are friends. It's a conflict.

OP posts:
Storminateapot · 19/04/2017 22:03

I suspect it's not true in the way you've heard it. It's really hard to run a lucrative business completely under the radar these days without being caught, I suspect maybe a bit of swaggery bullshitting has been misinterpreted.

Storminateapot · 19/04/2017 22:04

Sorry pressed send too soon - if you believe it to be true, report it anonymously. I've done it before, it's not difficult.

MrsSherlock · 19/04/2017 22:06

Report. Arseholes.

Crapuccino · 19/04/2017 22:06

Shelagh There are definitely better and worse accountants. The better ones are up to speed with the allowances, special exceptions, and assistance that small businesses are entitled to. I'm not talking about dodgy number-massaging here - I mean the genuine provisions put in place by government to help small businesses flourish. Those little provisions can go an awful long way towards helping with your tax bill. The shit ones don't know or can't be bothered, and HMRC isn't going to double-check their work for them. We were very lucky with our accountant for our little business back in the day. He did a lovely job of explaining to us each of the allowances we could claim and how to go about checking whether we qualified. He also had good strategies about putting aside money into a side-account each month for tax day which took a lot of the sting out of the bill. I didn't miss the bloody paperwork though when we decided to put the business into hibernation for the arrival of DS.

MrsSherlock · 19/04/2017 22:07

I suspect a handful of 'hard working' self employed individuals/families of tax fraud.
It happens more than you think

Original poster
Fairysnuff321 · 19/04/2017 22:21

Wow, finally read through all your comments, thanks...
Apart from the snide ones about how this has made me feel personally hurt, and this is somehow weakness. I seriously could not care less about your opinions if you think that way. Not sure why you would feel that you need to attack someone for how they feel, but hey your issue.

This is/was a close friend, and if true it would mean that (because of previous conversations) I've been lied to. Friends matter to me, honesty and openness matter to me.
I wouldn't report on hearsay.
OH is self employed, as am I. He also is a ltd company. He seems to be paying tax, and I agree tax avoidance is legal (although arguably immoral) but tax evasion is illegal.
I also worry about the impact if they are found out. If true I'm not certain she knows. Her OH can be a bit of an idiot (as in telling other friends oh he doesn't do tax) friends oh works in tax/accountancy area.

OP posts:
meshletterholder · 19/04/2017 22:22

can i de-rail? i know quite a few people at my work who are self employed contractors. how does it all work? They are very high earners but somehow still manage to claim 30 hours free nursery childcare and child benefit while my and my partner can't. Im just questioning whether i should become a contractor rather than having a fixed term contract!

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