Partner has never paid tax

heavensent_3

Hello everyone

I am hoping that their will be someone on here that can advise me as i feel i have nowhere to turn.

I have been with my partner for nearly 17 years and we have a son and a baby on the way.

My partner up until abount 6 months ago owned his own business which he took over from his dad when his dad passes away about ten years ago.

My partner is currently not working and is being treated for deprresion so we have been living of the credit cards for some months.

I thought our situation couldnt get anyworse until my partner dropped a massive bombshell on me.I was trying to support him through his depression and he just kept saying i have messed up all our lives and there is nothing i can do about it.

It turns out he has never paid tax while working for his dad and also when he took over the business. He said he went for advice when his dad first died about going legit but was advised that his mum could lose her house and any money she might have(not alot by the way).
I feel so torn , on one hand i love my partner and want to help him but on the other hand i feel like he has ruined any chance of a future together.

He also said that he is terrified of getting a job now as if he starts paying tax now then they will more than likely catch up with him.

So my question to you all is ,is their anyway back into the sytem?Is it to late for my partner to become a decent tax paying citizen.

We have no money and it seems no future and i could cry for my partners stupidity.

I KNOW alot of you will probably just say he deserves all he is getting but if you could find it in your heart to give me any practical advice i would be so grateful.

DrFluffy

He should seek legal advice ASAP, for no other reason than to talk to someone, off load and gain real advice, rather than fearing the worse. Have you tried the CAB?

WHA

In the circumstances described, don't go to see an accountant.

Accountants have to make a report to the National Criminal Intelligence Service (NCIS) if they become aware of illegal activities (money laundering etc) which includes tax evasion. Instead, you need "lega"l advice which can start at the CAB (although they tend not to get involved in businesses) but will more likely be a solicitor who specialises in tax affairs. Telling a solicitor all this comes under their "privilege" position where they don't have to make a report to NCIS, so the matter and options can be properly and openly considered without the background threat of prosecution.

This is contrary to normal advice, but the fact that he has been evading tax (criminal offence) for 10 years means that a criminal prosecution is highly likely when HMRC catch up with him. It is therefore important that he stays ahead of the game and comes clean to HMRC under legal guidance to get the best possible deal. If he waits for HMRC to catch up with him, the penalties will be far greater, both financially (tax, interest and 100% fines) but also the potential of a criminal prosecution (some people are imprisoned for long term tax evasion).

Accountants are generally not trained for dealing with criminal prosecutions (says a qualified accountant!) so are not the best people to deal with a situation of this magnitude.

Of course, all this depends on how much tax is at stake. If his business income has been relatively low, there may not be much tax and things become a lot less worrying. However, if his business has been the main family source of income for many years, the tax loss could be huge in which case prosecution is more likely.

There is a possibility that HMRC never find out, but equally there is a possibility that they will and throw the book at him. That's why I recommend proper legal advice from a tax specialist as your first option.

PosterBoy77

I think several things need to be considered before seeing anyone. A solicitor is going to cost alot of money and in my expereince will not tell you anything that you would not guess when it comes to these things. I.e go and own up and pay what is due. Also it all depends upon whether he has paid no tax deliberately or simply did not pay anything because it was never asked for it. At the end of the day this is no real excuse but could affect how harsh HMRC may be in such a case. Also, you have to consider if you could afford to pay any tax due anyway.

I'm sure someone will post some abuse with this, but for everyone concerned it may just be the best to not dwell on this and when he starts work just state that he was not working before the new job. It seems like the business was a sole trader business and not a limited company, as limited companies are automatically sent corporation tax returns.

It does not sound like your partner is a bad person, but events just overtook things and then he got so scared of when the Inland Revenue would do that he decided not to do anything.

If the inland revenue did not find out anything for 10 years, they probably will not ever unless someone tells them. For everyone concerned it would be better for your partner to simply get a job and start paying tax normally than risking further health problems and issues with the Inland Revenue. The stress of it itself may mean that he would not be well enough to find a job.

Society will get more for hom by having him work and pay tax than trying to ruin him totally.

Llyllyll

I would agree with the first two replies to your posting.

IMO I would take mikael's advice with a pinch of salt as he/she seems to think that HMRC (IR has not existed for over a year now) have very limited information and never find out anything unless somebody tells them (see the 'tax evasion' thread for a similar posting). I would not take that chance.

I DON'T think your partner deserves it at all, and it looks like you have posted here for some sensible advise on how to put things right. As already mentioned you may need to see a solicitor but yes, I would definately start with at least a phone call to the CAB.

Hope this helps.

Bossyboots

WHA wrote:

In the circumstances described, don't go to see an accountant.

Accountants have to make a report to the National Criminal Intelligence Service (NCIS) if they become aware of illegal activities (money laundering etc) which includes tax evasion. Instead, you need "lega"l advice which can start at the CAB (although they tend not to get involved in businesses) but will more likely be a solicitor who specialises in tax affairs. Telling a solicitor all this comes under their "privilege" position where they don't have to make a report to NCIS, so the matter and options can be properly and openly considered without the background threat of prosecution.

Solicitors are also bound by the rules to report tax evasion and they DO have to make a report to the NCIS. Privilege has been removed for this.

this_here_giraffe_laughed

Money laundering reporting shouldn't be a disincentive to seek the necessary professional advice. It is my understanding that if the back-tax is resolved within good time then a report does not need to be filed. Even if a report were filed I can't see how it would make a difference provided the OP's partner co-operated with the tax authorities.

PosterBoy77

Llyllyll wrote:

I would agree with the first two replies to your posting.

IMO I would take mikael's advice with a pinch of salt as he/she seems to think that HMRC (IR has not existed for over a year now) have very limited information and never find out anything unless somebody tells them (see the 'tax evasion' thread for a similar posting). I would not take that chance.

I DON'T think your partner deserves it at all, and it looks like you have posted here for some sensible advise on how to put things right. As already mentioned you may need to see a solicitor but yes, I would definately start with at least a phone call to the CAB.

Hope this helps.

I have certainly not said that IR have not existed, but if the chap cannot pay what could be due anyway, it is going to ruin him. Given that the situation went on for 10 years, you would think that if the taxman knew he would have done something by now? I'm not saying it is right to ignore the problem, but if he cannot pay what would be due what is the chap going to do? The taxman may easily find out if a neighbour was told who thinks they should report the situation. Only the OP can decide. I'm just trying to think of realistic things to be done. The sooner the person can participate in the system the better.

PosterBoy77

Another thing to think about is that the statute of limitation should protect you from the taxman making claims more than 6 years back. The only go back further in exceptional cases if serious fraud has been involved generally. If the business was not very profitable during its lastmonths/years it may not have been liable for much tax anyway. Only when you know the numbers involved and what the liablilty could have been can you really decide what to do.

cheerfulcat

heavensent, did your partner's father pay tax on profits from the business? Was it a cash in hand sort of business? Were proper books kept?

heavensent_3

His Dad did alot off cash in handwork !!!