Fraud or Not?

Canary_Lover

I know of someone who is claiming benefit, even though he operates his own business and has two sets of books. His declared income (it is available on line) could never support his lifestyle. His wife does not work and they claim family income support etc etc. This has been reported by several people, but nothing seems to have been done. However, we don't know how long it takes for the taxman and benefits people to take action.

But this is my question. He has just bought a brand new £30,000 car! On a declared profit of £12,000 pa plus benefits. I don't think so. He says his relatives have given it to him. No-one believes that, but if it is true, shouldn't the benefits people be told?

If anyone out there has a definite answer as to whether such a gift should be declared, or whether we should report this as suspicious I would be obliged.

HappyMJ

Canary_Lover wrote: »

I know of someone who is claiming benefit, even though he operates his own business and has two sets of books. His declared income (it is available on line) could never support his lifestyle. His wife does not work and they claim family income support etc etc. This has been reported by several people, but nothing seems to have been done. However, we don't know how long it takes for the taxman and benefits people to take action.

But this is my question. He has just bought a brand new £30,000 car! On a declared profit of £12,000 pa plus benefits. I don't think so. He says his relatives have given it to him. No-one believes that, but if it is true, shouldn't the benefits people be told?

If anyone out there has a definite answer as to whether such a gift should be declared, or whether we should report this as suspicious I would be obliged.

Sure why not...it's a gift he can still claim benefits. Gifts such as cars do not have to be declared.

Anyway if it wasn't a gift and he purchased the car he may have done it as a hire purchase agreement. Every payment towards the car he makes comes off his gross income reducing his profit. If his income is £18,000 he might be making £6,000 in hire purchase payments per year having a net profit of £12,000. It is a valid deduction.

spacey2012

I would study an on-line business accounting course.
£12,000 profit is AFTER every expense is deducted.
Transport is a business expense.
How exactly will any of this spite improve your life ?
Move on, put the time and effort in to improving yours and your families lives.

Canary_Lover

spacey2012 wrote: »

I would study an on-line business accounting course.
£12,000 profit is AFTER every expense is deducted.
Transport is a business expense.
How exactly will any of this spite improve your life ?
Move on, put the time and effort in to improving yours and your families lives.

I have studied it on line. His business expenses are very minimal. If he now introduced a huge transport cost for this car, which is not even business related as he has a van for the business, there would be little profit. Everyone, except it seems the taxman and benefits agency, knows he keeps back a load of cash he does not declare

It is not spite. I pay my taxes, always have, and I object to subsidising frauds. What is wrong with that?

tomtom256

If you have proof of anu undeclared income or hidden bank accounts etc then notify the National Fraud Hotline, they will in turn pass it onto the LA, DWP and HMRC for any appropriate action.

At the end of the day it's about hard proof not "I know what he's doing".

It could be he is being watched and financially investigated which could take 6 months to 2 years for a thorough finanical profile to be reached.

Canary_Lover

tomtom256 wrote: »

If you have proof of anu undeclared income or hidden bank accounts etc then notify the National Fraud Hotline, they will in turn pass it onto the LA, DWP and HMRC for any appropriate action.

At the end of the day it's about hard proof not "I know what he's doing".

It could be he is being watched and financially investigated which could take 6 months to 2 years for a thorough finanical profile to be reached.

Thankyou. I did not realise it could take so long, but what you say does make perfect sense. I do have proof of undeclared income (which I have previously reported), but not of where the money for the car came from.

I think I will report it, then the authorities can make their own decision whether to investigate or not.

Again, thankyou for your advice.

miduck

Before reporting it, you need to be more certain of your facts. For one thing, there is no such benefit as "family income support". From what you have said, even if they are claiming benefits, it would not be income support, but rather tax credits. You need to know the difference, they are administered (and investigated) by entirely different govt depts.

What you have described sounds to me like tax avoidance. Whilst unethical, it is certainly not unlawful.

Another point to consider - how do you know they are not living their life on credit, up to their eyes in debt? I've seen many people that appear to have great lives, and eventually end up bankrupt.

Canary_Lover

miduck wrote: »

Before reporting it, you need to be more certain of your facts. For one thing, there is no such benefit as "family income support". From what you have said, even if they are claiming benefits, it would not be income support, but rather tax credits. You need to know the difference, they are administered (and investigated) by entirely different govt depts.

What you have described sounds to me like tax avoidance. Whilst unethical, it is certainly not unlawful.

Another point to consider - how do you know they are not living their life on credit, up to their eyes in debt? I've seen many people that appear to have great lives, and eventually end up bankrupt.

Semantics, agreed. But I know they are claiming family benefit, whatever it is called. I would also say that undeclared income is definitely unlawful. There is a huge difference between tax avoidance and tax evasion.

I have said previously, I have proof of undeclared income, which I have already reported.

Blackpool_Saver

So many people on here want to nosy into other peoples business and they don't even have a proper understanding of the benefit system themselves, you see it so often, names used for benefits that stopped years ago

miduck

Canary_Lover wrote: »

Semantics, agreed. But I know they are claiming family benefit, whatever it is called. I would also say that undeclared income is definitely unlawful. There is a huge difference between tax avoidance and tax evasion.

I have said previously, I have proof of undeclared income, which I have already reported.

How do you know the income has not been declared? Do you know anything about self employed accounts?

HappyMJ

Canary_Lover wrote: »

Semantics, agreed. But I know they are claiming family benefit, whatever it is called. I would also say that undeclared income is definitely unlawful. There is a huge difference between tax avoidance and tax evasion.

I have said previously, I have proof of undeclared income, which I have already reported.

Just how much exactly are they earning and how much are they claiming in benefits. Child Benefit is not means tested...anyone including millionaires can claim that.

Income can be received in cash and declared. I'm not sure how you know exactly what this person has put down on their SA102.