Self employed

[Deleted User]

Hello. Myself and my boyfriend are planning to buy a house this year. I am in full time permament employment. The problem is my boyfriend. He has been selfemployed for the last 5 years, but he was not showing any earnings. Only 4 months ago he started paying taxes. Our credit report is excellent. We have 30 000 deposit and we want to buy a house up to 200 000. Is there any chance we can get a mortgage in 3 months time? Or do we have to wait another 2 years? What if the company he is working now for would employ him on permanent basis. Would that help? What should we do?

BoGoF

What do you mean by 'not showing any earnings'.....do you mean he was running at a loss or not declaring it to the taxman?

What is your income?

kingstreet

I suspect any mortgage you get now would be based purely on your income. Once he has a year's decent earnings, he should be able to get that used to increase the available borrowings.

If he became a salaried employee, his income may be taken into account from day one. That would depend on the lender.

I'd keep on saving. 15% deposit is good, but 20% or 25% would be better.

[Deleted User]

He was not declaring it to the taxmen. I only earn 20 000 per annum

BoGoF

So he's a crook......I'm out

kingstreet

Unfortunately, that's one of the downsides of defrauding the Exchequer. You gain on the tax swings, but lose on the mortgage roundabouts.

Thrugelmir

tapir19 wrote: »

He was not declaring it to the taxmen.

Has he file any accounts yet with the HMRC?

BoGoF

Does he intend telling HMRC of his undisclosed earnings?

[Deleted User]

I don't know what we should do. He is only paying taxes for the last 4 months or so

strongeo

I would very much doubt you would beable to get a mortgage in the near future if your boyfriend has been avoiding tax, eventually it will come to bite you though so I would save that deposit for the incoming bill from HMRC.

BoGoF

The reality is that most of your deposit is money owed to the taxman, so in that sense is not 'saved'. There is nothing to stop you coming clean to HMRC and declaring the income, that way you have proof of earnings for 5 years. Of course this will dent your deposit....but at least you have peace of mind that HMRC will not come after you. Better that than in 5 years they come chasing you and you potentially lose your house.