Salary calculation for mortgage.

Anonmagee

No we have no intentions of renting it. We plan to use it as much as possible.

In reality I don't know how anyone would know if rented it anyway. If we rented it to a family member who all live locally.

I'm sure apart from being fraudulent, invalidating insurances and the mortgage policy and being wholly dishonest. I'm sure it would be fine! Hehe

The plan we be to do it up, use it as much as we can. Maybe sell it in a few years. Seems silly to just put money in the bank, we should be grown up and get a house.:T

Thrugelmir

Anonmagee wrote: »

Our situation is a little different from 99% of the working population.

For good reason. Your employer is breaking the law. I wouldn't want to quantify the potential liabilities that your employer is accruing. Been a long while since I was involved in anything similar. In both instances though the employers concerned went under once the HMRC investigated. Not just the income tax, there's the Class 1A, the penalties and interest to consider.

amnblog

You need a broker.


There are numerous complications here.


Your income for the purposes the affordability calculators is 2 X £35,100

hcb42

Anonmagee wrote: »

The 500pcm is us being out of touch with reality as we haven't paid them in years.

I assumed water, gas, elec would be 100pcm each.
TV licence, phone lines, broadband, breakdown cover, contents insurances, regularly servicing of everything blah blah... Maybe 500 PCM is a bit steep I guess. No idea!?!? :-)

Not directly relevant to your question, but for comparison mine are:
Gas £44
Electric £27
Water £17

TV Licence £13 ish (although not paid monthly)
House Insurance (Building and Contents) £22
BT Landline and (Superfast) BT Broadband £45

(4 bed, 4 reception rooms - 2 adults only)

shortchanged_2

Are you MP's by any chance?

bclark

In all honesty I would suggest that the affordability for your mortgage is the least of your problems and you should be more worried about HMRC finding out about this arrangement and coming after you for years of unpaid tax.

Ignoring that issue though you don't need to inflate your income as you will do well on the affordability calculation by virtue of having very few outgoings.

Anonmagee

So that I understand this correctly..

Hmrc would only be interested in my "undeclared income"... The house, car, bills etc?

In my contract it states that I receive a net salary of 2100 and that my employer pays the tax. Presumably this offers me some protection as it's reasonable to assume they are upholding their end of the deal?

Especially as they employ 2 full time accountants to manage this.
Also my payslip shows they are doing this for my salary.

Does the employer or employee fill out the p11d?

Hmrc would not be bothered by the spending and being reimbursed? As neither party is gaining anything. if they were interested, we have receipts for every week and the payments reimbursing them.

This system of paying and being reimbursed has been going on for over 20 years.(not for me personally) perhaps I'm missing the point completely but there really isn't an issue here for hmrc.
Although I agree the risk is that I am not reimbursed due to lack of their funds, however I am satisfied that isn't going to happen.

Edi81

P11d is prepared by the employer and sent to the employees each year.

Are you not receiving one? If so, then there is something amiss here..........

d70cw6

call HMRC and ask them to investigate your boss.

:P

engineer_amy

Anonmagee, your employer should be filling in one of these forms annually http://www.hmrc.gov.uk/forms/p11d.pdf


Things like your rent and bills, cars, petrol need to be given a cash equivalent value. HMRC then do their calculations based on this information and send you a new tax code that will reduce your personal allowance, so you are essentially paying tax on the value of these benefits. so if your tax code on you payslip is 1000L and you haven't had any correspondence from HMRC then these benefits are not being declared. both you and your employer could face a hefty tax bill....


my understanding of the expenses on the credit card is that if there is no financial gain by you, then it does not need to be declared. If someone has better knowledge of this, feel free to contradict. my only concern would be if you ever did have an investigation by HMRC or other party, you may be asked to explain the very large values going though your bank account each month, and unless you are able to account for every penny exactly, things could be made difficult. for this reason, I would keep detailed expense reports with receipts attached every month, ensuring the amount that gets reimbursed matches the amount you have receipts for.