Broker suspicious I'm committing fraud...

Samantha_:p

Hi all,

Broker couldn't give much advice as she was suspicious of me so needed help here

I have a regular job and pay tax and student loan through PAYE.
Apparently I am also self employed but didn't think of it.

My self employment consisted of starting working Christmas 2012 doing make up, hair cutting/styling at weddings and places and it went from there.
Christmas 2012 - April 2013 - a few hundred £
April 2013 - April 2014 was about 11k
April 2014- April 2015 was about 9k
April 2015- Now about 9k

Was just cash in hand, 1-2 evenings a week. Just used that money to pay for things and hardly put it in the bank so no evidence there that I was self employed. I only realised when speaking to a broker who asked if I had additional income and I told her about my side 'job/hobbie'. calculated the above figures and got back to her and she gave a mortgage in principle after a credit check.

She asked me about some SA3 something form and asked about tax. Told her I never paid anything and she asked why not. I said I didn't even think of it (I know it's my fault). She asked if I had just made these up to get a higher mortgage, which is financial fraud. Also, no tax is paid, so tax fraud too.

Did research on 'employedandselfemployed. c o. uk' website and calculated how much tax I will pay, 7k!!! inc NI & Student Loans. HMRC penalties included mounted to 9.5K !!

Went to the high street shop/accountant and told them about my situation and they asked if I had evidence/paper work that I had made this money. I said all cash in hand and didn't put it in the bank. They said am I making all this up last minute to get a higher mortgage.

I just want to correct things and get my mortgage sorted! Please, anyone, anything?

ACG

You are commiting fraud by not paying tax on your income.

If everything is the way you have described then the broker has assumed you wanted to use your cash in hand income to support getting a Mortgage which may not have been the case? As it stands, you can only use your employed income to obtain a Mortgage and to satisfy the affordability requirements of the lender.

csgohan4

oh dear....


Ignorance is not an excuse on your tax liabilities.


What made you think no tax was liable on your 'side' earnings??


Your broker was asking for SA302 as proof of your self employment earnings.

https://www.gov.uk/working-for-yourself/overview
You can't have your :bdaycake: and eat it

mrginge

You can't have it both ways.
If the 'income' is genuine then you should have declared it.
If you didn't declare it to HMRC then you can't declare it on a mortgage application.

amnblog

The broker was probably alarmed that you have avoided perhaps £6,000 in tax and he has paid his.

Samantha_:p

I have used most of that cash in hand income and therefore my bank accounts hardly show any outgoings. It was an income and yes, my fault, should have declared it although this never crossed my mind (silly blonde). Accountants said they can sort all this mess out. But, can I obtain a mortgage? I have 3 months mortgage in principle and that time frame to hand in the Sa3..-something

amnblog

SA302

Are you saying you are going to submit tax returns to declare the income and pay the tax?

If you do however, you can prove the income to the Lender - although they may be concerned why the tax was not paid when due.

dunstonh

Perhaps your broker decided to report you. That may be why you are suffering issues from your other thread.

Anyone working in financial services is required by law to make reports for money laundering (that includes benefit fraud and tax evasion). Firms actually have to report to the FCA the number of reports they have made and that encourages the reports. The system actively encourages reports even if they are minor in the consumer eyes.

ACG

I think Samantha is Aella - https://forums.moneysavingexpert.com/discussion/5393561

_CC_

You are committing fraud.

lawriejones1

Ahh come one, a bit of undisclosed earnings - you wouldn't be the first. I've always paid all tax due and run a business, but I've seen it happen and it's not always fraud, it's often continued looking the other ways although how you knocked trough £11k in cash a year is very impressive.

Why not constitute your business from now on as a legal entity, however you choose to do so, and start honesty now. Working back, you'll never have records of expenses and costs incurred (you only pay tax on profit, not turnover), so I'd say start now afresh openly and honestly.