How far would you trust ...

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overthehill
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How far would you trust ...

Post by overthehill »

... someone you suspected wasn't declaring their pay to the tax man?

I'm uneasy about someone I've employed as a sales assistant. We advertised recently and had a relatively small number of applications, only two of whom actually met the criteria for the job. I invited both applicants to interview and only one responded. She seems a very nice, bubbly woman and has the admin and keyboard skills to deal with the back-end of our website, and a cheerful persona to deal with in-store customers. I needed someone urgently and, on paper, she's ideal. So, I offered her the job. In accepting, she included this condition
I require to offer my time and labour as an affiliate and would present a bill each week requesting the relevant compensation
My accountant had no problem with it, but said it was odd because she would have none of the normal benefits like holiday pay or sick leave. We assumed that, being British, she might have other income and/or may be paying tax in the UK. Anyway, I brushed it off and agreed.

Too late now, but it's bothering me. Firstly, she insists that I use "special deposit" rather than "pay" as my reference for bank transfers. Secondly, we had a slightly odd conversation about a friend of hers who had recently given up Airbnb after Airbnb started reporting rental income to the tax authorities.

The thing is, she submits an invoice each week, clearly specifying that she is receiving pay for work, so is it any of my business whether she's declaring her income? Would it bother you?
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Rebel Pebble
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Re: How far would you trust ...

Post by Rebel Pebble »

As a total freelancer, some companies I work for either put in their associate contract or require me to state on my invoices that I'm self employed and responsible for my own Tax and NI. If you're uncomfortable that you might get caught up in anything then you could insist on that.

However, I'm not sure, if she's working in person for only you, and on your premises using your equipment that she would qualify as properly freelance in the UK. It's a weird area and also you're in Ireland so I don't know.

I don't think you can second guess whether she's a tax dodger or not, just protect yourself from any fall out if she is. You don't want to be accused of avoiding employer NI or whatever the Irish equivalent is.
Last edited by Rebel Pebble on Sat May 04, 2024 3:31 pm, edited 1 time in total.
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Rebel Pebble
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Re: How far would you trust ...

Post by Rebel Pebble »

Also the reference for payment is pretty weak if she were to be fully investigated for any reason. Tax fraud investigators weren't born yesterday and a regular "special deposit" isn't going to fool anyone. I would suggest telling her your accountant (whether he did or not) says no to that.
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overthehill
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Re: How far would you trust ...

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Rebel Pebble wrote: Sat May 04, 2024 3:25 pm As a total freelancer, some companies I work for either put in their associate contract or require me to state on my invoices that I'm self employed and responsible for my own Tax and NI. If you're uncomfortable that you might get caught up in anything then you could insist on that.
The more we thought about it, the less sense it seemed to make. But she has signed an affiliate contract (ChatGPT is a wonderful thing :) ) - as I needed some reassurance that she wouldn't just suddenly not turn up to work one day - and I've included that wording, also reminding her that she will have no paid leave.
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Rebel Pebble
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Re: How far would you trust ...

Post by Rebel Pebble »

I don't see what she's getting out of it (legitimately) unless she has a big commute to deduct against tax. I can see why you're suspicious.
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Morganna
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Re: How far would you trust ...

Post by Morganna »

Can't you just ask her why she wants these things? If you phrase it as you not having come across someone wanting it before and checking whether there will be implications for you, I don't see why she should object.
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overthehill
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Re: How far would you trust ...

Post by overthehill »

Rebel Pebble wrote: Sat May 04, 2024 4:45 pm I don't see what she's getting out of it (legitimately) unless she has a big commute to deduct against tax. I can see why you're suspicious.
15 minute drive, tops.
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Ella77
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Re: How far would you trust ...

Post by Ella77 »

She’s not listening to you, her boss, and will only bring trouble.send her on her way.
isambard
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Re: How far would you trust ...

Post by isambard »

I'm with Morgs, I'd ask her why she requires these specific wordings/terms. Curiosity would drive me to at least see how she answers, before making whatever decision might come next.
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Marth
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Re: How far would you trust ...

Post by Marth »

The HMRC or equivalent would class that not as proper self employment I think.
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Re: How far would you trust ...

Post by Rebel Pebble »

Marth wrote: Sat May 04, 2024 7:53 pm The HMRC or equivalent would class that not as proper self employment I think.
That's what I thought.
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