Working cash in hand as a second job?

loobyloo0302

Hi all! I don't know if I'm posting in the correct section but I'll give it a go here!

My mum called me this morning and asked me to query with the tax office but they are currently unable to provide their usual service due to industrial action as it says on their line! I waited for 20 minutes and then gave up!

Anyway, one of my mums work friends has been offered a job as an addition to the one she already has. The problem is that it is cash in hand and so does not know where she stands with regards to this? The cash in hand still means that she would be short of her allowance (single status I think) I don't really know much about tax codes etc. just saw what came out of my earnings before maternity leave and my mum doesn't know as her second job is paid the usual way. Is there anyone that can shed any light as to what happens? For example, is it my mums friend who is supposed to inform the tax office or is it her employer? Does she have to pay tax on it at all as she's still earning under the allowance? I haven't a clue!

Soon_to_be_OAP

The employer is trying to get away with having to pay Employers' National Insurance; Holiday Pay; maternity Pay; etc; etc. If the second job is still going to keep her within her tax code, she should take it and then inform her Tax office. All the advantages of Cash in Hand jobs are with the Employer. What if she gets injured doing it? No chance of any compensation.

Nosht

As long as she is not claiming any S.S. Benefit then it should be OK, apart from the moral side of working for cash.
I know that many employers do this but at the end of the day if she does not take this up someone else soon will.
Offically the employer should deduct 25% for tax &c. & your mother's friend could do this herself & keep it separate if she was worried about the tax situation.

N.

zygurat789

Soon_to_be_OAP wrote: »

The employer is trying to get away with having to pay Employers' National Insurance; Holiday Pay; maternity Pay; etc; etc. If the second job is still going to keep her within her tax code, she should take it and then inform her Tax office. All the advantages of Cash in Hand jobs are with the Employer. What if she gets injured doing it? No chance of any compensation.

You'd be surprised how people enjoy breaking the law and fiddling the taxman AND get pound for pound what they earned, and they're very happy about it

loobyloo0302

Soon_to_be_OAP wrote: »

The employer is trying to get away with having to pay Employers' National Insurance; Holiday Pay; maternity Pay; etc; etc. If the second job is still going to keep her within her tax code, she should take it and then inform her Tax office. All the advantages of Cash in Hand jobs are with the Employer. What if she gets injured doing it? No chance of any compensation.

Thank you very much!! See we weren't aware of any of this at all! It's a cleaning job but I suppose with all jobs it carries risk of accident. She isn't exactly young either and so sick pay may be a problem - I'm just assuming there though Does all this apply to a contract aswel then? If she isn't actually registered in anyway as recieving money from the employer, would she not actually have a contract so therefore can be laid off at anytime?

"Offically the employer should deduct 25% for tax &c. & your mother's friend could do this herself & keep it separate if she was worried about the tax situation."

So they may deduct the tax amount then pay her the remaining in cash? Or am I completely wrong? Mind you, surely they should tell her first that they are doing that so that there isn't this worry? Or would they have told her already when offered the job?

Its all so confusing! Thanks very much for the contributions!

fengirl_2

All work implies a contract, whether its in writing or not - someone offers you work, you turn up and do it and they pay you - that's a contract. I dont know what you mean by registering her as an employee - the fact that you work for someone makes you an employee.
This whole thing sounds dodgy. A straightforward employer would say 'you are bieng paid £x per hour, for x hrs per week' and pay this less tax and NIC. She would be given a payslip showing those deductions.
If HMRC found out that the employer was not deducting tax and NIC, the employer would be required to pay this back to HMRC.

hermum

would she be cleaning for a company or domestic cleaning for a family?

tyllwyd

I know that if I was offered a job 'cash in hand', I'd assume that it meant that the employer didn't want the money going through the books, and that it was a all a bit dodgy. If she accepted the job, then innocently rang up the tax office to tell them she was being paid cash and was that OK - and that triggered an investigation by HMRC into the employer, I'd imagine the employer would not be best pleased!

If she is under her personal allowance (£6475 this year), she won't owe any income tax anyway. (I'm never sure about national insurance!)

I'm someone who like everything to be done properly, so if it was me I wouldn't take the job unless I could see that the paperwork was in order. Apart from anything else, has she thought about holiday pay or sick pay - if they are paying cash in hand, I bet they don't want to know about that! Is the job paying at least minimum wage?

tripled

I'm not sure how all the benefits lie with the employer. Most bars I know of that pay cash in hand pay a similar rate than those that pay through the books.

If the employee has another job (or is claiming benefit) then they get a nice tax-free income, albeit with no security (and the risk of being caught). The employer doesn't have to pay stamp contributions, maternity, holiday, etc. If both parties are happy with the arrangement, it is only the public purse that misses out (assuming the tax man doesn't find out).

John_Pierpoint

''Oh what a tangled web we weave when first we practice to deceive''

tripled

"The avoidance of taxes is the only intellectual pursuit that carries any reward."