Cash In Hand - Receipts?

[Pete Brindle]

I work with a lot of different clients on a regular basis, and I make sure that I give receipts for every little bit of work that I do, no matter how small, because I like to keep a record of everything to penny, all of the time.

However I was talking to a family member a few days ago who was saying that they keep some cash in hand payments without declaring them or providing receipts. I suppose in a way there's no way they could ever get caught out unless they were directly under investigation, but to me it doesn't sound like something I would be comfortable doing!

 

[Gemma Rowlands]

I don't pretend to be some hugely moral person or anything, but tax is one thing I don't have any question about - everything gets declared. Always has been, and always will be.

 

[Pete Brindle]

I don't pretend to be some hugely moral person or anything, but tax is one thing I don't have any question about - everything gets declared. Always has been, and always will be.

It's not about being moral a lot of the time, it's about being safe. I wouldn't want to risk ever being caught being untruthful about tax because the penalties could just about destroy me!

 

[Gemma Rowlands]

It's not about being moral a lot of the time, it's about being safe. I wouldn't want to risk ever being caught being untruthful about tax because the penalties could just about destroy me!

Someone who I know had a bill of £6,000 once because she accepted a rebate that she had questioned and HMRC had said it was all above board and fine - only to say the next year that she had to pay it back! So always always make sure you declare properly, and that you have the evidence to back it up whenever needed!

 

[Pete Brindle]

Someone who I know had a bill of £6,000 once because she accepted a rebate that she had questioned and HMRC had said it was all above board and fine - only to say the next year that she had to pay it back! So always always make sure you declare properly, and that you have the evidence to back it up whenever needed!

That sounds like a complete nightmare. If that were me I know that there's no way I'd be able to pay it! I always keep a small amount aside for emergencies, but not £6,000!

 

[Gemma Rowlands]

That sounds like a complete nightmare. If that were me I know that there's no way I'd be able to pay it! I always keep a small amount aside for emergencies, but not £6,000!

She actually had to borrow it against her home to pay it back, so it cost her more than that in the long term. She even said to them that she didn't think it was rightly hers and they paid it anyway, only to penalise her for it later!! Shocking!

 

[Pete Brindle]

She actually had to borrow it against her home to pay it back, so it cost her more than that in the long term. She even said to them that she didn't think it was rightly hers and they paid it anyway, only to penalise her for it later!! Shocking!

They should check all rebates before paying them. If they pay with no questions asked they're in the wrong IMO because it's not easy to self declare, and people are bound to make mistakes. But I suppose that's a huge income for them, so they're not going to want to get rid of it, are they!

 

[Gemma Rowlands]

They should check all rebates before paying them. If they pay with no questions asked they're in the wrong IMO because it's not easy to self declare, and people are bound to make mistakes. But I suppose that's a huge income for them, so they're not going to want to get rid of it, are they!

Well I absolutely agree with you. There should be some kind of system where bank statements can be sent with an explanation of income and outgoings and then it's decided but, as you said, that would cost them money and pay them less in fines etc so it will never happen!

 

[Lauren Turner]

I declare everything because there's too much to lose if I don't. I don't make a huge amount and my husband is definitely the person who earns the majority of the wage but it's nice to be able to earn a little bit on my own when I need it. I have a box (that I made and decorated myself, actually) with "receipts" written on so I never lose anything.

 

[Gemma Rowlands]

I declare everything because there's too much to lose if I don't. I don't make a huge amount and my husband is definitely the person who earns the majority of the wage but it's nice to be able to earn a little bit on my own when I need it. I have a box (that I made and decorated myself, actually) with "receipts" written on so I never lose anything.

Yeah it can hit people hard, particularly if you're only a low earner, if you don't declare something and then get hit by penalties etc. I know of someone who actually had to leave his own business because he messed up in this way, and had to get a more conventional job with a regular wage just in order to be able to sort it out. So that's a shame. He loved his business and it could have been avoided so easily if only he'd been more careful with his finances.

 

[Pete Brindle]

Yeah it can hit people hard, particularly if you're only a low earner, if you don't declare something and then get hit by penalties etc. I know of someone who actually had to leave his own business because he messed up in this way, and had to get a more conventional job with a regular wage just in order to be able to sort it out. So that's a shame. He loved his business and it could have been avoided so easily if only he'd been more careful with his finances.

If you feel your profits are low, and then you get hit by a huge tax bill at the end of the year, then indeed it can be understandably shocking. If you want to keep your business, and don't want to lose it, do everything by the book, or you're just putting yourself at risk.

 

[Mike Turner]

Some of our clients have asked us in the past to take cash in hand as it makes it easier for them not to declare their own earnings, but we always make sure we give them a receipt because there's no way I'm getting involved in helping people break the law.