Benefit Fraud or Just Plainly Immoral? [Housing Benefit]

tomtom256

Sounds like false accounting to me, thats the charge I would investigate.

But that being said, no different to how a lot of people "play" the system.

zagfles

For tax credits there are "notional income" rules for this sort of thing, see http://www.hmrc.gov.uk/manuals/tctmanual/TCTM04800.htm

I'd have thought HB would have similar rules.

See also http://www.accountingweb.co.uk/press/notional-income-and-anti-avoidance in particular the bit at the bottom.

poppasmurf_bewdley

Wasn't there something about people not paying themselves at least the minimum wage being prevented from getting certain benefits in the very near future? Something designed to prevent exactly what the OP is proposing.

Indie_Kid

poppasmurf_bewdley wrote: »

Wasn't there something about people not paying themselves at least the minimum wage being prevented from getting certain benefits in the very near future? Something designed to prevent exactly what the OP is proposing.

That sounds familiar. In fact, even now, I think HMRC are coming down on those who claim WTC for being self employed; but are making next to nothing.

BigAunty

poppasmurf_bewdley wrote: »

Wasn't there something about people not paying themselves at least the minimum wage being prevented from getting certain benefits in the very near future? Something designed to prevent exactly what the OP is proposing.

Not aware of it - unless you are muddling proposals under the future Universal Credit system which has greater conditionality for the self employed and wants them to aspire to earning at least the NMW in their income, possibly treating it as a notional income when it comes to benefit calculations.

dippy3103

BigAunty wrote: »

Not aware of it - unless you are muddling proposals under the future Universal Credit system which has greater conditionality for the self employed and wants them to aspire to earning at least the NMW in their income, possibly treating it as a notional income when it comes to benefit calculations.

I seem to recall there are provisions planned in UC for S/E people. Not sure what though

Prothet_of_Doom

tomtom256 wrote: »

Sounds like false accounting to me, thats the charge I would investigate.

But that being said, no different to how a lot of people "play" the system.

No. It's not playing the system. It's understanding the rules, and working to them.


The fact is it's not illegal if you are self employed via a ltd company you own 100% and pay yourself nothing, whilst you build the business. The ltd company can also lend the director, money from the business, as long as it is paid back within prescribed timescales. (If not there are NIC and Tax implications).


You have to accept that the Ltd company has it's own legal entity. It is separate from the owner.
New Companies frequently have to grow rapidly, so that profit is reinvested in stock or capital, for use later, and if the business plan says, hold onto money in the business, for later use, then what right have a housing benefit officer to rewrite the HMRC rules?

Prothet_of_Doom

blondebubbles wrote: »

HMRC are looking more and more into the self employed however Directors of ltd companies are not self employed not are they required to pay themselves minimum wage.

Most pay themselves just below the national insurance earning threshold and pay themselves the rest in dividends

The Directors of a business, do NOT have to pay themselves minimum wage, because (as I have hinted at) they may not make a profit at all, whilst they are building the business, or trying to get it to survive.

McKneff

I think it's pretty ironic that people come on here, asking about ways to play the system, but they have the bluddy cheek to ask the very people who are paying into the system now and paying these peoples benefits.......




And they are so bluddy ignorant, they don't even realise what they are doing.