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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

...to report friend to hmrc

366 replies

HMRCorNot · 02/02/2018 16:02

I have name changed for this

Close friend has at least 3 rental properties in prime locations. She Has been receiving rental income for over 10 years. Amounting to 6 figures(incl any mortgage amounts) Never declared.

She is In highest tax bracket so will be selecting no in drop down box for rental income on tax return which starts blank and then has two options yes or no - so no excuse to “forget” or not know.

I am also landlord and high earner so no jealousy. I find it immoral and unfair let alone illegal. She is surprised I declare!

Would IBU to report?

Can this be traced to me?

Can’t get comfortable either way.

Scared of reporting but feel ill that she feels she should be exempt from paying.

Wwyd? Aibu?

OP posts:
WitchIwasaWitch18 · 02/02/2018 17:24

I know someone who is being investigated at the moment. HMRC contacted my work to look through all his invoices from us going back 6 years. He is not co-operating. They are interested in his undeclared Ebay earnings which are fairly substantial.

I'm in the report camp even though I think the system stinks. When you friend is on over £100,000 plus all the undeclared earnings and there are people in real hardship I don't think its right to know the information and not disclose. Would you go to the police if she had disposed of a body?

rainbownights · 02/02/2018 17:26

I would report. I have reported someone before who was pretending to have split from her husband (six figure salary) and that he wouldn't hand over any money. She wanted the mortgage payments on her holiday cottage paid or something because she had had a bad year! Problem was she told everyone about this amazing scam (some people just presume everybody is "on the take") and several people reported her. It was a real Spartacus moment when someone admitted it and we all said we had!

Accountant222 · 02/02/2018 17:27

HMRC were having a crack down on landlords not declaring rental income a couple of years ago, there are many accidental landlords ( people who move and can't sell their original property, so rent it out). They were contacting every letting agency etc for details of property rentals, back dated (as always with HMRC) even if only let once. My sister and husband got caught out by them.

TalkinPeace · 02/02/2018 17:28

rainbow
several people reported her. It was a real Spartacus moment when someone admitted it and we all said we had!
Love it.

I admit that when a guy I reported was arrested I recognised the people sitting in several other "strategically parked " cars - we were all watching to see him get his comeuppance

MeYouYouMe · 02/02/2018 17:30

I don't get the logic that because some companies don't pay their fair wack it gives other people a reason not too. It's a pathetic, greedy and selfish reason.

ohfortuna · 02/02/2018 17:30

When you friend is on over £100,000
this woman has obviously done very well in life and is financially comfortable, a highly paid job and a property portfolio.
Why would she risk it all for stupid dishonesty...does she not realise that her comfortable life could come crashing down?

Sallystyle · 02/02/2018 17:32

I wouldn't report a friend.

I would report anyone else though.

Mind you, I don't think I could be friends with anyone who did this in the first place.

mumpoints · 02/02/2018 17:37

What happened to your sister and H Accountant222?

veuveo · 02/02/2018 17:37

I rented out a flat for years, no profit, only just covered the mortgage. HMRC sent me a letter recently, out of the blue. So they are chasing people. I would suggest something has changed recently that has enabled them to put the pieces together.

greendale17 · 02/02/2018 17:38

I would report her. I hate tax evasion and if everybody stopped with the 'not my business' attitude, the country would be a bit better off.

^Completely agree

ohfortuna · 02/02/2018 17:40

I rented out a flat for years, no profit, only just covered the mortgage. HMRC sent me a letter recently, out of the blue
are you saying that you were also not declaring your rental income?

The fact that there was no profit from the income is neither here nor there, you were carrying out a business and are obligated to declare as such to hmrc

CuriousaboutSamphire · 02/02/2018 17:42

They do focus on areas for a while at a time... it was online crafters for a couple of years. They trawl relevant sites and match info with details they hold. It can be quite scary when they get their teeth into your finances.

I have a friend who was almost wiped out by their back tax demands for her online selling business. She refused to communicate for so long they threatened her with all sorts... as soon as she called them they set up a repayment scheme and read her the riot act... note the order of that Smile

I too would report... it is greed and utter dishonesty, someone else (all of us) will be paying a little more than we should to cover it - even if it is micro pence per person per year, it is not acceptable!

BMW6 · 02/02/2018 17:42

Those trying to justify not reporting to HMRC because big companies are using tax avoidance schemes are missing an important point.
Tax Avoidance is entirely legal. Having as much as you can in an ISA is tax avoidance for example.
Tax Evasion is illegal and is what anyone is doing in under declaring income as the OP's friend is.

One is legal and justified. The other is not.

Kursk · 02/02/2018 17:42

The government encourages the infighting of the population. When people are busy reporting and judging each other, they are not watching what the government are doing.

veuveo · 02/02/2018 17:42

Nope I didn't declare it
I had at least 2 accountants tell me I didn't need to. HMRC didn't say I should have declared it, they were very helpful when I spoke to them.
I wasn't working, I wasn't earning.

ohfortuna · 02/02/2018 17:44

I have a friend who was almost wiped out by their back tax demands for her online selling business
she was prob not making all that much profit anyway so the tax to be paid would be minimal, it would be much less hassle just to do things properly from the start!

GETTINGLIKEMYMOTHER · 02/02/2018 17:44

Bluelady, it's not a drop in the ocean when so many landlords are at it, and have been for years.

Successive governments - not just the current one - have been extraordinarily complacent about this. It's high time there was a compulsory landlord register, with really hefty fines for anyone failing to comply.

Plenty of properties have been bought for cash in the past - probably fewer now since prices have shot up, and at the moment in such a case - if there is no LL registry locally - there is no requirement anywhere for the LL to inform anyone that s/he is renting the property out. So it's no wonder if LLs decide that lying to the taxman is a pretty safe bet.

veuveo · 02/02/2018 17:45

So no tax return.
No benefits either before anyone starts on that

House4 · 02/02/2018 17:47

GETTINGLIKEMYMOTHER what a great idea - a landlord register. But why are the government not doing that already?

Begrateful · 02/02/2018 17:48

Clearly she ain't your bestie otherwise you wouldn't be posting here.Grin
Do what is morally right and report it to HMRC then sit back and have tea.Brew

RidingWindhorses · 02/02/2018 17:53

I wouldn't be friends with someone who was defrauding the state.

I'm surprised at the number of people who would condone and turn a blind eye to tax evasion.

coffeeforone · 02/02/2018 17:59

To clarify my position, if she wasn’t a very good friend then I would report her without question. But I wouldn’t report my best friend or a close family member.

Crazyladee · 02/02/2018 17:59

If I'm honest, it would depend on the friendship.

If she was a very close friend, I would be leaning heavily on her to come clean and do the right thing to HMRC. Maybe giving a fake example story of a friend of a friend in a similar situation as her who was caught out by HMRC. It would be difficult to report a really close friend as the friendship would feel differently afterwards. And I would feel very two faced.

If she was just a more of an acquaintance or social friend, then I would absolutely report. I would be seething that she is getting away with it.

I'm actually baffled that she has admitted it to you! If I had it in me to commit fraud, I wouldn't tell a soul!

Fraying · 02/02/2018 17:59

even a company would need to pay unless paid in dividends and below threshold
If they are owned by a company, and the rent declared in company accounts then they're irrelevant to her personal tax return.
Your confusion over this would make me question how accurate the rest of your information is.

LambMadras · 02/02/2018 17:59

She is deliberately breaking the law. Meanwhile the NHS is on its knees and tax avoiding cunts waft around in their expensive cars thinking they are above the law.

Report her, without a doubt. And actually you may be breaking the law by harbouring tax evasion if you do nothing.