To report her for tax evasion?

[hooveringhamabeads]

I know of someone who is making around £1k a week, but hardly declares any of her income (she doesn't pay any tax at all so declaring less that £10k of it). She also claims tax credits.

I don't particularly like this person and am tempted to report her. Problem is, pretty much all the money she receives is in cash, so is there any way that the HMRC would actually be able to prove or disprove what she's earning?

OP, you seem to be confusing two things. Benefit fraud - for which having read some posts on here, it seems they're fairly direct about why they're investigating.

And tax, for which they'll just launch a general investigation and they probably won't say it's about fraud (at least until they have actual hard evidence, not only your word). However, unless she's a complete moron, she'll know something/someone has triggered it, so it won't matter what they do/don't say, she's still going to jump to conclusions.

If it was a banker on a 7-figure salary who wasn't paying any tax I doubt there'd be so many "mind your owns".

I had no idea tax evasion was considered socially acceptable under a certain amount. Don't suppose anyone could tell me what that amount is?

Evasion is evasion, regardless of the number of zeros.

Why the fuck should OP 'mind her own business'? Tax evasion affects us all, it's disgraceful to play the system like that when so many people are paying and struggling. It's your moral duty to report her OP. If everyone ignored this type of thing we'd end up like Greece (flat broke).

Fuck sake, of course report her! Even if you're good friends you should still report her. I bet half the people saying mind your own are those who proclaim the Tories are ruining the county.

Country

the regular kind of inspection that anyone who is self employed can randomly have

I'm self-employed. I fill in my tax return every year and pay my dues - I hate people like the OP's acquaintance as they fuel the "all self-employed people are on the fiddle" perception. I'm not. I'm sure there's a declaration you have to read when submitting self-assessment which is along the lines of declaring everything, no omissions and that you understand that it's a criminal offence not to declare.

However it sounds as if the OP's acquaintance isn't even registered as self-employed which is a crime in itself, irrespective of what you're earning.

And of COURSE you could spend cash like that if you had to. Shopping in Waitrose/M&S. Buying watches or jewellery. Holidays where you pop into the travel agent and hand over £100 a week. Involve friends and family so that they're all paying £100 a week into accounts. Easily done.

@ OP:

Making a profit implies she is running a business. To be reasonably sure that means you must know: how she takes money out (salary v dividends); how much profit she invests back into the business; what her capital allowances and deferred tax positions look like etc.

^ this. Do you know her situation that well OP? I've heard people say they make x amount "profit" but when you get down to it actually they don't. Or they "get" x amount money so you'd expect the tax to be higher but it isn't due to legal tax avoidance.

Yes, do it without a doubt. You can report her anonymously online here;

www.gov.uk/government/organisations/hm-revenue-customs/contact/reporting-tax-evasion

Is she a landlord getting rent in cash for a hmo by any chance and you are an ex-tenant?

Good luck OP, ignore the naysayers.

Btw, she is probably declaring a very low wage (which is under the tax threshold and "entitle" her to tax credits) and allow her to explain some of the amounts in her account, should any one ask.

And tax, for which they'll just launch a general investigation and they probably won't say it's about fraud (at least until they have actual hard evidence, not only your word).

You'd know you were being investigated for fraud if they turn up at your house at 7am with 10 vehicles and the police don't let anyone leave until they've finished searching including lifting all the loft insulation while looking for paperwork. (That was not me being investigated btw!)

katronfon - I'm a higher rate tax payer, pay a great deal of VAT and corporation tax and have done so scrupulously throughout my almost 30 years in business.

I said earlier that I have never claimed benefits.

I've had a VAT investigation precisely once in all those years. I knew immediately what had prompted it and who had reported it. They admitted to it a few years later. It was purely down to nastiness and jealously (even though they are very wealthy themselves.) It's a little bit more than a ballache.

The problems I have with the OP are that I don't believe for one minute this person is earning £1000 cash profit every week; the OP mentions she doesn't like the person (yet if she really knows this person well enough to have all this accurate information about her income and tax affairs, she must be very close to her and trusted by her), which suggests to me some real nastiness underneath all this; and finally she seems confused about whether she wants to report benefit fraud or tax evasion, which are completely different things .

If she has clear evidence of benefit fraud, then of course she should go ahead and report it. And the same for tax evasion, although I suspect she doesn't know quite as much about this person's tax affairs as she thinks.

I wouldnt bother. For a start your reasons are possibly based on envy and revenge? Is that a good enough basis? Will she know it was you? what would happen then?

I might be in a minority here but im not that keen on paying tax myself. Why should i ? if i can trouser some of the money that I have worked for then i will.

You sound like an intelligent person - IMO you'll be doing yourself a favour by putting your energy into something more constructive for the greater good than targeting one individual person, it really won't end well.

Paying tax IS for the greater good and an individual evading tax makes life worse for everyone.

It may give some instant gratification, but a little bit dies inside when a person sneaks on their fellow human just because they can.

Then surely someone sneaking thousands of pounds of unpaid tax is dying inside every time they spend money that should be supporting our NHS etc?

Evasion is evasion, regardless of the number of zeros.

couldn't agree more. Tax evasion is no better than theft. The rest of us get charged more tax because the treasury isn't taking in as much tax as it should.

Meh, if you know she is committing fraud, do report. If she is completely above water, she has absolutely nothing to fear, so no harm done - apart wasting time for the people who will check, which I don't encourage, but if you are sure OP, go for it.
If you are just making it up, then don't. Obviously.

TDHManchester that attitude is sickening. Do you have no "bigger picture" awareness at all?

OP of course report her. She is committing fraud, and this is the business of anyone who uses the NHS, public roads, refuse collection, schools, libraries - the list is endless.

I hear you @ mintychoc and if i could be assured that HM Government were using all of our taxes wisely and efficiently then i would take a different view but sadly they are not. They squander and waste as if its a bottomless pit. Even basic rate taxpayers are paying more than half of what they earn back to the state. It is nothing short of enslavement. I dont blame anyone for avoiding tax. Whats good enough for the very wealthy is good enough for the bottom feeders i.e most of us.

I agree that she should be reported if you're suspicious. As a self-employed person who has to (quite rightly) pay lots of tax every year it would piss me right off to know that someone else is swindling the system.
I guess it is kind of petty to do it just out of spite but if I'm honest I would be pretty tempted in your shoes too!

Report her. We need people like you.
(The fact you have an ulterior motive is neither here nor there).

So nobody should ever report someone they don't like for doing something illegal, just because it makes them seem petty??

She is breaking be god damn law and she should be reported!

Of course she should be reported. And you don't need to know if she is definitely tax evading or the degree of fraud. If you think her behaviour is suspicious, report it. If she's boasting about the money she's making cash - report it. The HMRC will investigate and if there is crime they will act on it. Just like if you happened to have a neighbour that had all kinds of visitors at their door day and night for only a few minutes at a time - you don't need to know what's going on, but it's suspicious. It's not necessary to be sure a crime is being committed before you phone the police and they get drugs busted a week later

if i could be assured that HM Government were using all of our taxes wisely and efficiently then i would take a different view but sadly they are not. They squander and waste as if its a bottomless pit.

And the problem with that attitude is that everyone can find a reason why they shouldn't personally pay tax because it isn't being spent on areas they like.

Trying to shoe horn the "wealthy" use legal tax loopholes is childish tbh.