Employer deducted wages but hasn't paid tax

Ninjabel

I just got a phone call from my boyfriend telling me that the employer he has been working for for the last 3 months has been deducting tax from his wages but not paying it to HMRC. They haven't even told HMRC that he's been working for them, despite his providing them with a P45 from his last employer. There have been tax codes and deductions stated on his pay slips since he started, but not a penny has been paid in tax.

I know that he is ultimately responsible for paying the tax and that he will be saddled with the bill, but surely there has to be some repercussions for the company? Is that not fraud?

Any thoughts greatly appreciated.

PlutoinCapricorn

If your payslip shows that tax and NI have been deducted, and the amount paid to you is the net not the gross pay, then the employee is not responsible. It is the employer who is responsible for passing on the deducted amounts to HMRC.

PlutoinCapricorn

"Insolvent employers and those who fail to pay tax and National Insurance deductions to HMRC
Employers may deliberately avoid paying payroll taxes to HMRC. Sometimes they will have submitted inaccurate returns to HMRC so that HMRC is unaware of how much money is owing to them.
In such circumstances, your only evidence as an employee that tax has been paid on your behalf, is likely to be your payslip."

http://taxaid.org.uk/guides/taxpayers/tax-for-employees/problems-with-employers

McKneff

How does your boyfriend know all this......

PlutoinCapricorn

It certainly is his responsibility to check his tax code and ensure that correct amounts are being deducted, but he cannot be held responsible for what his employer does - unless he is running the payroll!

It is possible for him to report this to HMRC, but the employer might realise who told them.

xylophone

Has your boyfriend been advised by HMRC that the tax has not been received? Otherwise, how does he know that it hasn't been paid over?