Letter from the HMRC inv Ann Summers

andrew71

First of all not sure if I've put this in the correct section so if I have then I do apologise.

My wife's recieved a letter this morning from the HM Revenue and Custom regarding work she did with Ann Summers.

My wife did do some parties for Ann Summers but she stopped doing them over five years ago due to myself being diagnosed with M.E/CFS which meant she didn't have the time to do them.
As far as we were aware the people who recruited her told her that we didn't need to bother with taxes etc because Ann Summers dealt with all of that.
They are now requesting information from my wife inc income recieved, records kept of invoices and income.

We do not have any of this information anymore due to the fact the information contained names, addresses and sometime credit card details of her customers after a year or so we thought it would be best to shred this information.
Like I say it is over five years ago now. I am just concerned that they will stop our benefits we get due to this.
Any help and suggestions on this matter would be much appreciated.
I don't think companies like Ann Summers or Avon do give enough information regarding paying tax to party planners like they should do.

fengirl_2

HMRC will not share this information with anyone else and there are no grounds to stop your benefits.
My advice would be to co-operate with HMRC and dont ignore them. If you can afford to pay an accountant to deal with this, then do so.
If not, you will need to get bank statements for 5 and 6 years ago and try and reconstruct the income and expenditure. HMRC do not noromally go back more than 6 years.
Write and tell them what you have told us and ask them what information they require, bearing in mind it will be 5 yrs old. I'm sure you also realise that ignorance of the law is no excuse.

andrew71

Any income my wife recieved was cash which we used for shopping etc. If somebody paid by credit card it was paid to ann summers and not her.
So our bank details would have nothing to show for this. We can not afford to pay an accountant and if we did I doubt there would be anything that we could say that could help them out.

Pennywise

You will be able to get copies of invoices from Ann Summers which showed what you bought. Once you know what you bought, you can work out the value of your sales, hence the profit, and after that you can do your best estimates of overheads etc.

Whether or not you think you can afford an accountant you may find that you have no choice if HMRC raise what you feel are excessive assessments of the tax you owe, on top of which they will impose interest, surcharges and penalties. An accountant will be able to stand up to the tax inspector to shoot down any unreasonable assessments and also negotiate penalties downwards. I'd expect the accountant will save you more in tax and penalties than their fee!

Caroline73_2

I have been party planning for over 11 years (with a variety of companies) and I have always been told that as a party planner I am self employed and responsible for my own tax and NI.

As your wife was working on commission and not receiving wages slips showing NI or tax contributions what made her think she was paying it?

McKneff

However customers paid Ann Summers your wife would have received the commission on the sales she made.
Was this paid to your wife in a cheque.
Ask the HMRC what details they require and like the other poster says, you might have to go to your bank for old statements.
If ann summers told your wife that they dealt with the taxes etc they were obviously wrong. Did you wife furnish them with a P45 to enable them to deal with her tax etc. Probably not.
I dont think a lot of party planners realise that commission on these and any other likewise parties is earned income and thereby taxable.

Caroline73_2

McKneff wrote: »

However customers paid Ann Summers your wife would have received the commission on the sales she made.
Was this paid to your wife in a cheque.
Ask the HMRC what details they require and like the other poster says, you might have to go to your bank for old statements.
If ann summers told your wife that they dealt with the taxes etc they were obviously wrong. Did you wife furnish them with a P45 to enable them to deal with her tax etc. Probably not.
I dont think a lot of party planners realise that commission on these and any other likewise parties is earned income and thereby taxable.

Actually I think a lot do realise but just think they can get away with not declaring it.

McKneff

Dont be too frightened about all the above. If you wife wasnt doing anyother work at the time to pay any income tax then there will be none due.
I've seen one or two scaremongering sentences on this thread so like i say,
dont worry too much.

andrew71

Thanks for the replies. My wife was working at the time but like now she was only working part time (16 hours per week). From what she was told by her leader she did not have to worry about tax etc because it was dealt with. I agree it is ignorance but I wonder how many other people have been told this when they have started party planning?
Would Ann Summers have information about what she brought going back that long? If it had been last year or so then I wouldn't have been worrying as much but because it is over five years ago and we have no proof etc then this is what is worrying. Why as it taken them so long to get intouch with us about this?

FatAndy

I'd be wondering why HMRC have suddenly contacted your wife after so many years. Maybe Ann Summers have a list of active agents and your wife's name is still on it, so maybe HMRC are asking for this info because they think your wife is still working for them? Might be worth checking with Ann Summers to see if this is the case.

It's also worth writing back to HMRC to say that your wife hasn't worked for five years, explain why and if possible provide some evidence. Maybe they'll decide this isn't worth persuing (don't quote me on that though).

paulwf

andrew71 wrote: »

Would Ann Summers have information about what she brought going back that long?

Most business records have (or are advised) to be kept for a minimum of 6 years so they will probably have it archived (finding the archive may take a little while though).

According to a Business Link article payroll records have to be kept for a minimum of 3 years after the end of the tax year they refer to so there is a small chance they don't have the records.