I have been incredibly stupid

Tasha28

I had a visit from a HMRC representative today. I have been a sole trader for 3 years and I stupidly haven't put any money aside for tax.

I don't earn very much, it comes in dribs and drabs so it seems like just enough for myself and my 2 children to get by on with my partners wage paying the mortgage and bills.

I have an outstanding tax bill of £3500, another £1500 expected to add on to that next year and a credit card of £5000 and another of £1000

I honestly don't know what I have been playing at - just sticking my head in the sand. My partner and I have a joint mortgage but he has paid for everything in the home (aside from things like school uniforms), The HMRC woman has said that I need to make some kind of installment offer or the case will end up in court and I could have the bailiffs sent to my home or go to prison.

I am absolutely sick with worry about this and I know it is all my fault. My partner isnt here a lot as he has a really long commute, I am petrified of him finding out about all of this. I just want to fix it but I have no savings or anything, I didnt even use an accountant because I couldn't afford one. Please help.

Hannah_10

Ok, she's said bad things will happen UNLESS you make an installment offer... So we're here to help you. First off lets see your SOA, (click here for more about what that is https://forums.moneysavingexpert.com/discussion/107280)

If you do it as accurately as you can then it can even be used to show HMRC (and can be used in a court).

Your other port of call is tax aid, even the citizens advice bureax defer to them. http://www.taxaid.org.uk/

Stop kicking yourself Ok, we've all made mistakes, guilt does no good at all, only remedying the situation does any good, and we're here to help you as much as we can with that.

You should really tell your partner. Most people fear telling thier partner they have got a debt problem, only to later find that they get nothing but support. The HMRC lady is prepared to take installments, so nothing bad has happened yet, if you're taking advice from Tax Aid nothing bad WILL happen either, so you can take your husband a problem you are already in the process of solving and not a bottomless pit of fear about something that wont come to pass if you are on the ball.

Applecider_2

Hey Tasha!

Firstly take a deep breath.... youve taken a good step, youve come on here and people on here are fab! Ive been in debt once stupidly im back but not as bad and there is more than a million ideas of what you can do.

Secondly you need to show exactly what position you are in for yourself and for people on here to help you. SOA your State Of Affairs. How much debt have you got.
whats ur wages coming in
what are your regular outgoings, essential
how much u need for shopping, kids, etc
any other needs.

at least then everyne has a clear picture.

Then you need to phone CA and ask them what is the best route for you. Remember an offer can be anything like £1 a week, its shows willingness.

If you need ideas on saving money, changing bills, cutting out stuff and getting things for free then lemme know! heres a great link for you...

https://forums.moneysavingexpert.com/discussion/107280

Take it easy... from here on in it can only get beta

Tasha28

thank you for replying!!!!

I will go through the calculator tomorrow once I have got the school run out of the way.
My partner and I have a joint mortgage but we aren't married, would he be held liable for my debt at all? Does what he earn affect what I can offer to pay them? His wage on paper looks a lot but as he has a 140 mile commute (!) and pays all of the mortgage and bills it is soon gone.
My work is mostly seasonal as well so in the winter my income nosedives somewhat, what I would like to do is to offer them the bare minimum with a view to paying more as my income goes up in the spring. Thank you again for replying, I might just sleep tonight (first time in a long time)

Applecider_2

Best thing is to be honest hun, get all your info down, then u can see where you are, what the bare minimum is then get into some saving challenges and maybe look into some casual work. Ps does ur husband get any petrol allowance?

Tasha28

I thought I would have a quick look before bed. I don't know my partners wage or how much his outgoings are but here are mine


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 950
Partners monthly income after tax....... 0
Benefits................................ 134
Other income............................ 0
Total monthly income.................... 1084

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 40
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 340
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 12
Car Insurance........................... 70
Car maintenance (including MOT)......... 5
Car parking............................. 5
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 80
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 622


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 4000
Other assets............................ 0
Total Assets............................ 4000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Credit card....................5300......132.......27.9
credit card 2..................1200......25........14
Total unsecured debts..........6500......157.......-


Monthly Budget Summary
Total monthly income.................... 1,084
Expenses (including HP & secured debts). 622
Available for debt repayments........... 462
Monthly UNsecured debt repayments....... 157
Amount left after debt repayments....... 305

Personal Balance Sheet Summary
Total assets (things you own)........... 4,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -6,500
Net Assets.............................. -2,500

LilacPixie

For you to be due 5k in income tax/NI over the last 3-4 years you must of been earning a fair amount. For example 11k earned in 07-08 would have tax of around 1k. And for another 1500 due end of 10-11 you must be expecting to earn arond 14k by April.

So that begs the question how have HMRC came to these figures? From your actual returns or are they determinations.

Please think of your accountant as a valuble helper and not and expense, really a good one is worth his, or her weight in gold

LilacPixie

if your SOA is accurate (presuming your partner covers the other bills etc then you are in a position to not only make HMRC an offer but to seek professional help in the form of an accountant

Monkeyballs

Hi Tasha,

I'm not going to offer any advice as I don't really have any particualr experience in this field. I just wanted to pass on my regards and hope you get it sorted...

Both Hannah_10 and LilacPixie seem to be pretty on the ball so I reckon they're offering some sound advice.

Re. stressing, you said yourself that the HRMC lady mentioned that if an offer isn't made then bad things will happen... They have to say this, if they don't then they are breaking the law. They aren't bad people, you've just got in a pickle which I'm sure you'll get sorted soon :-)

Take care and good luck.

BTW, Might want to look at you're mobile charges... £40 is a lot these days ;-) Good luck x

Tasha28

Thank you for your replies.

My partner is very good with money (which makes me feel even worse as I have royally screwed up) and I know 100% that the only debt he has is a 7k loan he took out to pay for my car (it was on hp but his current loan was a more favourable rate)

He works offshore and won't be home (or even in mobile range) for at least a week but I know you are right Bullau, the only reason I haven't told him is that I am ashamed. I know he will be furious

Tasha28

I have spoken to a guy at Tax aid and I am going to go and speak to a CAB debt advisor on Monday about how to get interest on my credit card frozen - the card was cut up a year ago but I still owe 5299.
I think what I need to look at doing is getting a part time job to help pay off as much of my debt as possible, and not spend money on stuff obviously.