Sister's financial situation - what to do?

LandyAndy

ddebski_us wrote: »

I understand how self assessment works; I only mentioned minimum wage to indicate how little she earns in comparison to her debts.

In fact, there would be some debate as to whether she was self-employed. She only ever worked at one place (as a farm hand) and he dictated her holidays etc. She was paid cash in hand (no tax deducted at source). I know this would not be classed as self employed by HMR&C but she has not paid any tax (or NI and so there are pension issues for the future too!)

I know she hasn't submitted her returns. I saw her statement dated Dec 2012 at the weekend - littered with penalties for non-filing from Jan 2006. It amounts to £3.4k and is growing.

Then submission is a priority to stop the penalties. HMRC may well negotiate on the timing of payment of those penalties once the returns are up to date. make returns even if they are 'best estimates'.

I'm a little surprised they haven't sued her for these penalties already.

getmore4less

Last time I filled in back returns with penalties moste were eliminated becayse they could not be more than any tax due(there was none).

I think this changed but not sure when.


One stratatgy might be to force the situation over the tax returns in isolation at first ignoring the other issues unless they come up..

ddebski_us

LandyAndy wrote: »

Then submission is a priority to stop the penalties. HMRC may well negotiate on the timing of payment of those penalties once the returns are up to date. make returns even if they are 'best estimates'.

I'm a little surprised they haven't sued her for these penalties already.

getmore4less wrote: »

Last time I filled in back returns with penalties moste were eliminated becayse they could not be more than any tax due(there was none).

I think this changed but not sure when.


One stratatgy might be to force the situation over the tax returns in isolation at first ignoring the other issues unless they come up..

Thanks both. LandyAndy - I am amazed HMR&C aren't chasing her harder - surely they should throw the book at her on this - practically fraud!

So, do I confess that I saw the letter from HMR&C and say we need to deal with it and that I will help her? She is so moody, she is bound to throw a wobbler at me for reading her post, but it needs to be dealt with doesn't it. And she can't deny it if I've seen it?

I'm going to lose her trust once she knows I read her post, but then, I don't trust her either.

eamon

As you are removed by distance from both your sister & mum. I would suggest that your first strategy would be to arm your mum with the tools & techniques that she needs to deal with an underperforming adult that is behaving like a cuckoo. But as others have said is your mum up for this? Find this out and perhaps a way forward can be found.

dancingfairy

It really needs to come from your mum (or your sister herself hitting rock bottom and reaslising she has a problem). You need to support your mum to stand up to her.
Either:
1) she lets the situation continue - not great for anyone involved (your sister is squandering her inheritance, getting more and more in debt by the day and not paying her way, your mum worries and has to live with the fear and stress etc etc)
2) your mum toughens up and starts to charge rent etc or
3) your mum throws your sister out.

Frankly allowing the situation to continue is not actually doing anyone any favours in the long run (although it may seem less painful in the short term to your mum). Your mum is the one really that has to make the hard decisions and you can only really give your input and be there as much as possible.
df

coinxoperated

My younger sister is exactly the same. Doesn't want to face life and all its ups and downs and thinks everyone else will bail her out. My sisters 4 years younger than me. Our mum died when were were teenagers and I've always took on a motherly role.

Over the past 5 years shes had about 15k off me to pay off debts, general 'i'll give it you back when I get paid' rubbish.

She had a boyfriend that earns 3x what I do, yet she'll come and ask me for money as she's 'desperate'... Last July I put the nail in the coffin and cut her off financially and told her to grow up a bit.

4 Months she begged for money. Credit card companies reduced her limits, (she didn't have much debt, about 300 as muggin's over here had paid it off for her!!) and she actually asked me to pay for a 45 ticket for her to see a band she liked...

She fell out with me, called me horrific things.... and now...

She's at uni, budgeting well, cleared her 300 quid debt and actually has respect for the value of money and how we all need it to survive. It's tough, but she needs to learn.

If you think she's taking advantage of your mum, tell her and your mum that! Your mum will do what she feels is right, if thats paying off your sisters debts, let her do it. Concentrate on your own life, your own finances and just be there for a shoulder to cry on and to offer budgeting advice if needed.

Be strong.

michelle2008

I know you must be worried - but while she has talked about your mums inheritance has she actually asked for any money?

The problem seems to be she is still living like a teenager. But remember with you so far away she is company for your mum. I know she is causing a lot of stress and upset for your mum - but if you can all find a way of getting her to face up to her debts while remaining supportive then you should be able to salvage the family relationship - which must be very important to your mum with your dad gone.

Try and take the emotion out of it, could you offer to sit down with her and total all he debts, then work out a realistic plan for HER to repay them?

It may be worse than you think, or it may be not as bad.

Good luck

bouncydog1

This has been my sister for 20 years. She has been bailed out by mum, left to sort things out on her own, been made bankrupt etc.etc. Over the years my mother has been put under terrible stress of phone calls, letters etc.

It has now reached the stage where my mother who is nearly 80 has had to take over sister's finances.


I have told my mother several times to ask her to leave etc.etc. but she won't as sister is her flesh and blood. I have now learned to leave them to get on with it. Whilst you are right to be concerned about your mum, it really is none of your business unless your sister is prepared to fess up and accept responsibility for her actions.


Definately do not pay off her debts as she will learn nothing. If she is bullying your mother then all you can do is try to be there as support for your mum. Unfortunately as the saying goes you can choose your friends but not your family.

atrixblue.-MFR-.

i would say it would be upto you mum whether or not she wished to bail her out of sisters debt, it her cash to with as she pleases, even if sister asks for it, it would be mums decision to give it.

my advice would be to tell mum, to impose a structured system in place where by IF and only IF the cash is handed over its to pay off the debt with mum there to securely know that is what the cash is going towards, and that she now has to give back to the household by way of board and lodge, contributing to the bills and to never ever take out any kind of financial agreement ever again whilst living at the address cards,loans etc if the agreement is broken then she must repay the amount given to her to wipe the slate clean and have it writing.

the next thing to do would then claim PPi back over the loans or credit cards she has taken out in the past, this is where you could come in, in managing that aspect and when the cash arrives, is to split the cash up, half to mum half to sister, sister can spend on what she wants mum gets some repayment to put back in her pot.

if mum decided no she not going to help sis out then sis may weel turn to you, how you end up in managing tht cry for help is upto you. perhaps helping out with structuring her finances.

ddebski_us

Thanks for all of the replies.

I do agree mum needs to decide what action to take, but she has categorically asked me what she should do as she doesn't know. When my sister does borrow cash from mum (which both has told me has happened recently), I ask my sister if it has been repaid (yes) and my mum (don't know). Mum is so rubbish with money that she can't even remember if my sister has repaid £30!

I have slept on it overnight, and mulled over all the answers on here (even the ones I didn't like - sorry!) and I have come up with an action plan.

My sister started a new job yesterday. I am going to speak to mum about charging my sister board (say £250 pcm? - sound fair?) and having it set up as a standing order into mum's account. I'll help set up a separate savings account to keep it all in. Then, although it should be spent helping pay household bills, if the day ever comes, it is there to help with debt repayments.

I am also going to 'fess up on seeing the HMR&C demand letter. I'll say it was an accident (I'm doing Dad's probate at the moment and so reasonable that I may have thought a HMR&C brown envelope in a pile with other post may have been for Dad) and by the time I realised I had seen what was on it. I will offer to help her sort this out.

This will then give her a blatant opportunity to tell me about anything else (as she has lied in the past about having no outstanding tax returns). If she doesn't, fine. I know not to trust her as far as I can throw her.

So, does the above sound like a plan? I feel daft posting all this on a public forum, but I'm emotionally involved in this situation and so outside views are very useful!

xDx