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Where Taxpayers and Advisers Meet

PAYE or Self Employed

vector
Posts: 39
Joined: Wed Aug 06, 2008 3:42 pm

PAYE or Self Employed

Postby vector » Mon Mar 13, 2017 5:09 pm

I rent out my properties and a family member does all the work associated (my agent) He has 2 other jobs both part-time but can add up to 50 plus hours. These are in retail
The work that is done for me is around the other employment schedules he has and is given . I used the HMRC tool to assess whether he is self employed or employed by me and it came out as self-employed. A niggle is, given his other obligation, he can only do my work re property rental as it would be impossible to take more work on. I picked up in my readings a contractor must have more than one client. Is this correct ?

bd6759
Posts: 3076
Joined: Sat Feb 01, 2014 3:26 pm

Re: PAYE or Self Employed

Postby bd6759 » Mon Mar 13, 2017 6:00 pm

Provided the answers you put into he status tool were accurate, HMRC will respect the conclusion.

vector
Posts: 39
Joined: Wed Aug 06, 2008 3:42 pm

Re: PAYE or Self Employed

Postby vector » Mon Mar 13, 2017 7:59 pm

Thanks. I did. Cast your opinion on this scenario. The self employed person pays NI and tax due. HMRC come along and argue the person is employed.
Does then the " employer" become liable for the tax and Ni ( even though the tax has been paid the then self-employed). Entirely hypothetical but how would that work. Tax refunds are basis 4 years yet HMRC can go back 6 and then some.

bd6759
Posts: 3076
Joined: Sat Feb 01, 2014 3:26 pm

Re: PAYE or Self Employed

Postby bd6759 » Mon Mar 13, 2017 11:44 pm

An employer is liable to operate PAYE and pay the correct amount of tax to HMRC. If the employer does not deduct it from the employee, the employer is still liable to pay it. If the employer was not held liable, the PAYE system would crumble because no one would bother to operate it. There are get outs with simple mistakes and collusion with the employee, but HMRC need to make an appealable decision to hold the employee liable.

A failure to account for PAYE follows similar rules to income tax. 4 years is normal, 6 years if the employer was careless, and 20 years if the employer's actions were deliberate. HMRC can take into account tax paid by the employee when determining the amount of the employer's failure.


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