Reply to: Tax Investigations....

[VectraMan]

I know someone caught in a similar way (don't know why, but he was self-employed so presumably it's a cash in hand thing). HMRC made him personally bankrupt, but not until he spent a couple of years working as much as possible and paying back 75% of what he owed. He needn't have made the effort.

[AtW]

It is not a problem because it is the bank who will suffer loss - when scummers take money from your bank account, then you may actually lose it - you certainly won't have your money for sometime until matters get resolved, but in case with morgage it is the bank who gets stinged and unless they can prove you actually assisted in scum you won't be affected much. See the article:

"Because the money is actually stolen from the lender, identity-theft victims aren't liable to repay the lost funds and don't lose their homes. It's the lenders who are out of luck."

It seems to me that morgage operations are very lax in the USA.

[oraclesmith]

Well it happens in the States :-

http://homes.wsj.com/buysell/mortgag...05-cullen.html

[AtW]

they could take out a mortgage for maybe £200k in your name.....

I don't believe it - for started the morgage will be paid to the seller of the house, and the bank would have the house - its their risk more than mine. Scum who get into online bank accounts (way too often sadly Russian) want just one thing - your money in the account, perhaps getting you into overdraft. Making online loan application is very possible, but getting morgage is certainly not something they would do: remember it is the seller that gets the money anyway, the process is slow and it won't happen unless its certain that seller actually owns the house. And even if it happens then its 200% bank's loss, you won't have to prove much at all.

[oraclesmith]

If they can see it, then they have already stolen it, plus, do you think they would care about your past spending when they got into your bank account?

Question : what do you need to apply for a mortgage ? Lots of bank statements for a start. You might only have a couple of thou in your current account, but they could take out a mortgage for maybe £200k in your name.....

[AtW]

The whole bank account history on-line ? Great for identity theft !!

If they can see it, then they have already stolen it, plus, do you think they would care about your past spending when they got into your bank account?

[oraclesmith]

The whole bank account history on-line ? Great for identity theft !!

If I ever mention I'm getting an on-line bank account, just give me a slap !

[AtW]

LTSB now put online whole statements, definately going back a few years.

[oraclesmith]

Yeah, presumably he had to pay the bank for copies.

[AtW]

Cost him a a bit to disprove it as he had not kept personal bank statements and had to pay for about three year's worth.

But banks keep this info for at least 3 years?!??!

[xoggoth]

Yeh, provided you can show what the real figure is you should be ok. In my case when I might have owed them a k on expenses they just added up the entire expenses in the accounts including all the valid stuff and van costs which I had already paid tax on as a BIK. I challenged it and ended up with a small rebate in the end.

Bloke next door to me was stupid enough (he is VERY stupid) to casually remark that he might have paid some money for logs into his personal account and not put it in the books. He got assessed for thousands. Cost him a a bit to disprove it as he had not kept personal bank statements and had to pay for about three year's worth.

And don't believe accountants if they tell you you have no choice but to pay up. Ignoring them and challenging things has certainly paid me in the past.

PS They cannot demand to see personal accounts without making a separate application

[oraclesmith]

I believe they can inspect your personal accounts if they are linked to your business accounts - eg. if you have paid for business expenditure (not expenses necessarily) with your personal account/credit card and been reimbursed by your company through the Directors Loan Account. I don't think salary and divi payments count, but just where the original business transaction was done with your personal account.

[AtW]

What they DO DO is slap in big estimates of tax due without attempting to quantify it properly and leave it to you to disprove it.

But this is mainly doable in case of cash-in-hand operations like plumbers - if all you do is contract with invoices payable by cheque/bank transfer, then it would be rather hard to slap an estimate, unless of course there are some funny big deposits into your personal account, but I am not sure IR is actually allowed to look into personal account of director easily, though allegedly IR will just smash your toes with a hammer.

[xoggoth]

Atw's right, that £1k for a tiny mistake is crap. What they DO DO is slap in big estimates of tax due without attempting to quantify it properly and leave it to you to disprove it.

[TheMonkey]

**** - that reminds me that I haven't paid the HMRC PAYE for about 4 months. Not got any reminders yet.