how do builders fiddle via Ltd Co ?

[MicrosoftBob]

If enough of them do it, there are not enough hectors to catch'em, their risk profile for an investigation must be pretty high though

[bobspud]

As with all these shenanigans eventually it becomes pretty bloody obvious that a bloke with a small income and lots of cars and expensive stuff is taking the piss. 20% is not a hard price to pay for being legit and safe from harm while paying the country some dosh.

[smatty]

Possibly also keeping each under the VAT threshold so he's 20% cheaper than rivals, or charging same & making more profit.

[SimonMac]

yeah I guessed that...wish I coud withdraw all as cash and do the same with agencies! get them to pay in my kid accounts!

how does the builder cover payments to a wife's account, surely hmrc could question such payments if investigated?

If the customers get a cash discount how can HMRC trace the payments?

[diesel]

If the customers get a cash discount how can HMRC trace the payments?

this builder never offered us any cash discount, asked for 1st cheque to his Ltd co, now 2nd to his wife!

[SimonMac]

this builder never offered us any cash discount, asked for 1st cheque to his Ltd co, now 2nd to his wife!

Let me guess the receipt is in the post!

[AtW]

If the customers get a cash discount how can HMRC trace the payments?

They might not have to - will use existing stats to infer what his real business should have been and issue him a big fat tax bill + penalties.

[DaveB]

If he;s got any sense he's only fiddling the CT and not the VAT. CT sits in the IR side and they are crap at managing investigations. VAT sits ion the VAT side and they are tulip hot at it. If they get a whiff he's fiddling that they will go after him.

If the job gets bodged or he gives you hassle shop him to the VAT man.

[diesel]

If he;s got any sense he's only fiddling the CT and not the VAT. CT sits in the IR side and they are crap at managing investigations. VAT sits ion the VAT side and they are tulip hot at it. If they get a whiff he's fiddling that they will go after him.

If the job gets bodged or he gives you hassle shop him to the VAT man.

don't think he is vat registered but will phone vat people to check anyway.

[vwdan]

If it makes you all feel any better I knew a self employed sparky who offered a "cash discount" to a lady who turned out to be a VAT inspector. I don't think she pushed as hard as she could have, but I got the impression he learnt his lesson.