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BinDumb
Starting Member
5 Posts |
 Posted - 09 April 2009 : 00:26:51
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Hi everyone, 1st post here and need to ask a question which I'm in a REAL panic about...
Essentially, I'm going to declare bankruptcy as I have debts and am on benefits... The last few years have not been good ones for me as far as my mental welfare is concerned - everything that has happened has more or less made me shove my head in the sand. Divorce, redundancy, etc. But I've really screwed up (please don't judge me, I know I've done wrong...) I was offered temporary work with my old company a few times from 2007/08 and then last year too, and while I originally thought that it was just a bit of temporary work, it turns out that it was on a self-employed basis, making me liable for my own tax. I didn't declare this at the time, or even register as self-employed with HMRC. Now I'm really panicing and all up in knots about it all. There were no actual written contracts or anything, and the last time was just going to be a week's work but turned out to be a little more. I don't think I even signed off benefits for that one. It's only recently that I've managed to get my head around everything and have realised the mess I'm in.
Yes I know I've been really dumb, but what is likely to happen and how can I make the best of the situation? Can anyone PLEASE advise me?
Many thanks |
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chester2005
Average Member
United Kingdom
786 Posts |
Posted - 09 April 2009 : 00:52:54
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firstly welcome to the forum
I think i can answer some of your questions but an expert will no doubt be along to help soon
If you have debts and are insolvent you can declare BR. if you didn't tell the tax man you have 2 choices , not tell them and worry about them finding out (not a good idea) or tell the tax man about your earnings and let him tax you, any tax owed would be included in BR.
As far as working on benefits don't know so i won't guess
Dave
Don't worry or know that worrying is as effective as trying to solve an algebra equation by chewing bubble gum.(Baz Lurman)
Life's too short!!! |
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paulsc
Junior Member
289 Posts |
Posted - 09 April 2009 : 07:40:34
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You need to inform the Tax Man within 3 months of starting to be self emplyed or you get fined £100 so i would consider your best option as all benefits will need to be paid back to.If you want to go bankrupt i believe you need to bite the bullet and confess as if you go bankrupt the OR will want your bank statemnets and if you put money or was paid into bank they will ask questions
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Edited by - paulsc on 09 April 2009 07:41:11 |
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John
New Member
United Kingdom
73 Posts |
Posted - 09 April 2009 : 07:50:11
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Hi
firstly you should be aware that declaring yourself bankrupt does not mean there will some kind of spanish inquisition hellbent on bringing the wrath of HMRC, benefits agencies, creditors and Uncle Tom Cobbley (showing my age again)and all upon your head.
What would be the point for the OR to focus his attention on the low level, and unplanned, non payment of tax which would, in bankruptcy, be written off anyway?
Your post suggests that on one (just one remember from a few)occasion you may even have forgotten to inform the benefits agency that you had worked.
My opinion is that you are working yourself up into a lather unnecessarily.
OK, you have yourself recognised that technically you made a few errors but the OR's duty is to realise as much from your estate as he can for the benefit of your creditors and to take appropriate action where serious fraud is evident.
From the details you have given, on a good day your examiner will not flinch. On a bad day they may point out your errors and remind you of your obligations to HMRC and the benefits agency at that time, at which point you will no doubt nod in agreement, explain in a few words that there was no intent, and the conversation will move on.
I would be very surprised if any examiner were to pass this information on as it will benefit (no pun intended) nobody and will take time and money to prove.
John White
England Jackman & Spacey |
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John
New Member
United Kingdom
73 Posts |
Posted - 09 April 2009 : 07:57:59
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Hi
it may help to put things in prospective so if you could provide a little info.-
In 2007/8 you did not claim benefits when working so no problem there. How much would you estimate you earned in that tax year?
In 2008/2009 tax year, same question?
And how much in benefit claim would you estimate you made when working the last time?
John White
England Jackman & Spacey |
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RHB
Senior Member
1159 Posts |
Posted - 09 April 2009 : 08:37:44
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| You won't owe any tax though will you? If you worked so little? If you really feel bad come clean with the benefits agency & arrange to pay back what you overclaimed those weeks out if your benefits now. |
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BinDumb
Starting Member
5 Posts |
Posted - 09 April 2009 : 09:49:48
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Thanks for the replies everyone, it's been really helpful reading your replies.
In answer to your questions, John, I would say that in 07/08 I earned just over £9k post redundancy, and just over £8.5k in 08/09. I guess that'll translate to tax arrears of £2.4k and £1k respectively. Of course, the tax for 08/09 isn't actually due until next year, so I don't know how that would be handled. The benefit thing is about 6 weeks' worth...
Thanks again for your replies, everyone! |
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John
New Member
United Kingdom
73 Posts |
Posted - 09 April 2009 : 09:50:30
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Hi
another thought, your tax return for 2007/2008 was due to be submitted latest 31st Jan 2009 so not horrendously overdue. In any case if you declare bankruptcy you cannot pay it.
The return for 2008/2009 is not yet due and will also be written off as the liability for that tax year will now be included in your bankruptcy.
John White
England Jackman & Spacey |
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BinDumb
Starting Member
5 Posts |
Posted - 09 April 2009 : 10:17:43
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| John, are you suggesting that I declare bankruptcy and leave it at that or get in touch with HMRC and let them bill me? Will the tax suddenly become due if they find out about it post-BR? I just don't want to get myself tangled up in a whole load of brown stuff and end up with further debts and possibly a BRO... |
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John
New Member
United Kingdom
73 Posts |
Posted - 09 April 2009 : 10:44:34
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Hi
of course I would not for one moment condone tax evasion of any kind but in this particular circumstance basically yes. Purely from the viewpoint that it seems to me to be a futile exercise for you to submit a return (or returns) for the HMRC to incur cost calculating your tax laibility only for you to declare bankruptcy whereby HMRC cannot be paid.
In the unlikely event that in the future HMRC do raise their head in respect of possible pre bankruptcy tax liabilities the presentation of a copy of your bankruptcy order will nullify that liability anyway.
John White
England Jackman & Spacey |
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BinDumb
Starting Member
5 Posts |
Posted - 09 April 2009 : 12:05:47
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| Thanks John. Can I possibly call you about this some time after the weekend just to clarify a few things? |
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John
New Member
United Kingdom
73 Posts |
Posted - 09 April 2009 : 12:20:54
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Hi
of course.
I am actually back in the office on Wednesday of next week. The office number is 01258 839283.
Just leave a message including contact name and number and please also state that you are a forum member. I will get back to you on a withheld number.
If there is a particular time you would like me to call Wed PM please let me know.
John White
England Jackman & Spacey |
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BinDumb
Starting Member
5 Posts |
Posted - 09 April 2009 : 12:25:46
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Many many thanks!
In the meantime, have a great weekend! |
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Topic |
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Have Been VERY Stupid
