My sons loan.

Spleensmrs

Going back to December last year my son who is 17 was offered a job at a neighbours business. It was initially on an adhoc basis and then became more frequent to the point that in February he was pretty much full time. However after a few weeks of working full time he questioned why he wasn't paying tax or NI as there wasn't any breakdown on his pay slip, he asked on numerous occasions to go on the books but it fell on deaf ears. It transpires that most of the staff within their business are paid cash in hand including their own son who gets handed a wad of cash each Friday. In February of this year my son passed his driving test and obviously sought quotes for car insurance and as you can imagine the cost of insurance was through the roof. He received a quote but the deposit was £423 and unfortunately his father and I weren't in a position to help him out. When he discussed this at work the owners of the business offered to lend him the £423 and he could pay it back weekly, which I understand was very kind of them and he was extremely grateful. He repaid the debt at £20 a week but then at the end of April they started to make his life unbearable whilst working with them and eventually it got to the point of constructive dismissal on the 13th May. He has been trying to find employment but currently isn't working and obviously due to his age he cannot claim job seekers allowance. Our neighbour came over to our house 4 weeks ago re: an outstanding balance of £80 from the original £423, I answered the door and explained that he wouldn't be able to pay that amount at that time as he just doesn't have it. I'm recovering from my 4th fight with cancer and I don't work so its only my husband's income that comes into the house for 5 of us. Things are extremely tight financially at the moment. Then yesterday I receive a letter addressed to me by recorded delivery stating that unless I pay the outstanding balance by the 8th July they are going to persue me through the court. The document also states that they will charge me interest, administration charges or any other charge that they feel appropriate. I have at no point been a guarantor for this loan and have never signed anything or even verbally agreed that this debt is mine. I'm not denying that the money is owed but as I have stated earlier my son just can't pay it. Talking to these people won't work as they have even been harrassing my son when he just walks to and from the house, something that my husband has now put to rights by telling them in a polite way to stop. Please can anyone tell me if I am responsible for this debt or how I go about putting a letter together with definite facts about why I am not liable for this debt if this is the case.
Thanks

chalkie99

Have already replied to your other post in the lending money to friends and family thread.

crazyguy

I would imagine it will be hard for them to show proof in a court for this debt as it was cash, I suggest you just ask them to be patient and even if you can give a little amount then they may back off, you dont want to go down the route of causing any trouble back as they are neigbours, but if they are paying cash to all staff they are likely not to be paying all tax and ni as your son found out on a pay slip, so if they do get nasty then maybe politely say that you will report them to the tax office, they may then give you a bit of breathing space !

Apples2

I'm confused...

In this thread you said YOU paid the deposit

Spleensmrs wrote: »

Hi,
In February my eldest son passed his driving test and I agreed that he could go onto my insurance so that he could gain driving experience. By no means have I been fronting either... Anyway the cheapest quote I could get was £2114 inc instalment interest. I paid £423 deposit and then a dd payment of £197.11 so in total £620.11.

The third post on the same subject is here
https://forums.moneysavingexpert.com/discussion/comment/44961600#Comment_44961600

margaretclare

This firm should be 'shopped' to the HMRC. Paying everyone cash in hand! Robbing the rest of us honest taxpayers of tax income. In addition, the fact that your son wasn't paying tax and NI meant that he couldn't have qualified for jobseeker's allowance - he hadn't paid any of the necessary national insurance contributions.

Spleensmrs

Apples2 wrote: »

I'm confused...

In this thread you said YOU paid the deposit

The deposit was paid from my bank as thats where the money was paid into as the direct debit had to be in my name due to insurance companies wanting a 17 year old to pay for their insurance in full. Sorry to cause any confusion...

Apples2

Anyway, as Chalkie has stated in the other post, this is not your debt.

If it were all Cash in Hand, I can't see how they can prove they even lent the money in the first place.

Tell them to Prove the debt exists and drop hints about the HMRC.
Either way, it is up to your son to sort it out, it has nothing to do with you.

Spleensmrs

margaretclare wrote: »

This firm should be 'shopped' to the HMRC. Paying everyone cash in hand! Robbing the rest of us honest taxpayers of tax income. In addition, the fact that your son wasn't paying tax and NI meant that he couldn't have qualified for jobseeker's allowance - he hadn't paid any of the necessary national insurance contributions.

Quite agree that's why he kept asking why he couldn't go on the books and this is when they started being spiteful and vindictive towards him. They then took on somebody else and within days he was told to leave!!! We have subsequently found out that they are deeply unpleasant people with a history of vindictive acts towards anybody who crosses them....

Spleensmrs

@Apples2 Forgot to mention that the insurance problem has been sorted out after alot of persistance!!!!

margaretclare

Spleensmrs wrote: »

Quite agree that's why he kept asking why he couldn't go on the books and this is when they started being spiteful and vindictive towards him. They then took on somebody else and within days he was told to leave!!! We have subsequently found out that they are deeply unpleasant people with a history of vindictive acts towards anybody who crosses them....

First thing Monday morning, get on the phone to HMRC. http://www.hmrc.gov.uk/index.htm

pvt

Spleensmrs wrote: »

Quite agree that's why he kept asking why he couldn't go on the books and this is when they started being spiteful and vindictive towards him. They then took on somebody else and within days he was told to leave!!! We have subsequently found out that they are deeply unpleasant people with a history of vindictive acts towards anybody who crosses them....

In your OP you said it was constructive dismissal becasue his life was made unbearable, now you're saying they replaced him and dismissed him.

Am I also correct in assuming that as only £80 is left, that 17 months has elapsed between him getting the loan and being dismissed?

Reading the post you said the loan was to your son, but you also indicated they paid the money into your bank account. I guess that as they can only prove they gave the money to you, they are threatening you with the court action. But for £80 it's unlikely they'll bother, especially if you feed them a tenner every now and again.

Finally, was your son paying NI and declaring his earnings via a tax return if it was cash in hand? The answer might be a significant thing to ponder before you call HMRC and call the kettle black.