MONEY MORAL DILEMMA. Would you pay Brian the Builder in cash? 30 December 2008 at 5:30PM in Money Saving Polls 99 replies 29.1K views

Former_MSE_Wendy

Here's this week's hypothetical situation for you to cogitate on:

Would you pay Brian the Builder in cash?

Brian the Builder's been rebuilding your front path. His original written quotation was £1,500 including VAT. Yet the day before he's due to settle, he suggests "why don't you just give me £1,200 in cash tomorrow... then I needn't do any paper work, if you know what I mean?" Would you pay the non-VAT price, knowing he's probably tax evading, would you report him, or just pay the normal price?

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Previous MMDs:
Do you break the no Christmas present pact?
Would you give a car park attendant a back hander?

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Miss-spent_2

That's tricky. Because that is a lot of money I would want a proper numbered receipt, letter headed and everything in case something went wrong or I needed it to claim on insurance, so in this case I wouldn't.
My mum had almost an identical situation recently with regards to buying some railings and she paid the VAT. We are glad because they have not turned up yet but at least she has proof she handed over £1400.

However I do pay the man who chops down my trees once a year in cash with no paperwork etc but then I inspect the work first.

Trow

My answer living where I do would be potentially different to my answer if I lived elsewhere.

Here, I would know the builder, if not personally than by reputation and by personal connections - so I would be happy to save the money safe in teh knowledge that he is reputable and would put any issues right. The 'ethical dilemma' of him not paying teh VAT is not my ethical dilemma - its his call to do the paperwork or not, and its on his head if the VAT man makes an inspection and decides things aren't as they should be. Thats his responsibility alone.

Having said that, if I was in an area where I wasn't likely to know the builder, then I would want the proof of payment in case of any later problems with the work.

TinyMolly

I really struggle with this one. I always look to get the best deal that I can, however my conscience will not allow me to knowingly encourage someone to beak the law and 'steal' from the tax man. Bit of a bummer really as I could have saved a load of cash here over the years!

bigkris_2

No problem - I'd offer him £900 and he'd snatch my hand off!!! (this is the real world we're living in!)

slummymummyof3

bigkris wrote: »

No problem - I'd offer him £900 and he'd snatch my hand off!!! (this is the real world we're living in!)

I'd chance my arm with £750

jenniewb

Lol- hadn't thought about asking for a reduction- nearly changed my mind!

But personally, I know little about how tax authorities work. I would be too scared that eventually this guy would get found out and my name dragged into it, tax bills and fines to follow- I know I would not be able to afford to pay the extra (would not be able to afford to pay the bill in the first place!!)

smiker

Personally I would suspicious. He is offering a larger reduction than the VAT anyway, so he is going to be worse off. This is even more so if this price includes materials that he has paid VAT but now cant reclaim.

Before he was due to get £1304 and the VAT man £196. He might also have been able to reclaim the VAT he paid on the materials.

Now he gets £1200, and is unlikely to be able to reclaim the VAT on the materials.

So why offer this amount of discount? Kindness of his heart? Is there another reason why no paperwork (stolen materials, planning to leg it etc)?

It could be cashflow and he is offering a discount.He would have been better off with offering £1380 inc vat for cash but with paperwork. You get a discount, he gets the cash and all legit...

colthecodman

as long as i knew the guy its cash every time for me the tax evasion bit is not my problem

dowyboy

smiker wrote: »

Personally I would suspicious. He is offering a larger reduction than the VAT anyway, so he is going to be worse off. This is even more so if this price includes materials that he has paid VAT but now cant reclaim.

Before he was due to get £1304 and the VAT man £196. He might also have been able to reclaim the VAT he paid on the materials.

Now he gets £1200, and is unlikely to be able to reclaim the VAT on the materials.

So why offer this amount of discount? Kindness of his heart? Is there another reason why no paperwork (stolen materials, planning to leg it etc)?

It could be cashflow and he is offering a discount.He would have been better off with offering £1380 inc vat for cash but with paperwork. You get a discount, he gets the cash and all legit...

If he's not putting the £1200 through the books, then he's also avoiding paying corporation tax, income tax and NI contributions, so he'll end up with nearly £500 more in his pocket than if he'd done it the right way.

grapage

The "Black Economy" every time as far as Im concerned, we all have to help each other and I think this government takes more than enough from all us hard working people on taxes etc and then wastes it on stupid projects and lining their own pockets.
:beer: