Employed illegaly - what should I do now?

Apollo114

Hello everyone,

Long story short: I was employed illegally without realising a thing.

I’ve been employed at my workplace (small business) since May 2016. It’s one of those places where things aren’t done how they should, everything is disorganised and my boss himself is an extremely dishonest and unethical person. I had never signed a contract with my employer. Receiving payslips was always a difficulty, hence I only asked for them when I needed them. Payments were sometimes made late, and so on.

I did a year-long apprenticeship, and then continued to work there, as an employee. Around September 2018 I told my employer that I will be leaving, since I will be starting my Access College course within a month. After a few days, I told my employer that I’d be happy to stay on a part-time basis, which he seemed very happy about. He told me that he had already terminated my employment, but he will employ me ‘privately’.

A few days later I asked my employer for payslips from the previous 3 months, because I needed to provide them to my college, in order to receive a bus-ticket financial support. Since then, I didn’t ask him for any payslips.

A few days ago (which is approximately a year since I went part time) I asked my employer to provide me with payslips, because I thought I might need them for my tuition student loan application. My employer told me that he cannot provide me with any payslips, since I am not on company employment. He said I am working privately on contract (although I have never signed any) and paid in hourly basis.

I have checked my HMRC account and it appears that he hasn’t been contributing any NI and Tax since I went part time. I feel absolutely clueless what to do in this situation.

My question is:
I’m going to discuss this matter with my employer on Thursday. ACAS have advised me to speak with HMRC.
The problem is I am not sure who was liable to pay my tax and NI for the period after I started working part time, hence I am not sure how I should approach HMRC: report my employer, or inform HMRC that I wasn’t paying my tax and NI.

Your quick response would be very appreciated!

gettingtheresometime

Would you ha be been due to pay any tax or ni on the wages received ?

Apollo114

I am afraid I don't know. Please advise me.
Since I went part time, I've been earning approximately £890 - £960 per month.

MovingForwards

https://www.thesalarycalculator.co.uk/salary.php

Based on your higher figure no tax but NI payable.

MovingForwards

On your lower figure it's still no tax but NI payable.

Did you pay tax and NI when you were working for him before? It will be on your wage slips.

Apollo114

When I was working for him before I went part time, he was paying my NI and Tax, as I was earning around 1300 a month (due to doing more hours at the same rate). I have payslips to prove it.

Dazed_and_confused

Was he reporting it to HMRC though?

I think you can check this on your Personal Tax Account (definitely for 2018:19 if not any earlier).

Apollo114

The National Insurance record for 2018-19 is not available yet. 2017-18 and 2016-17 have been reported.

When it comes to tax, everything up to 31st of August 2018 has been reported.

Dazed_and_confused

Seems an odd one. If they were employing you and reporting things correctly when you were full time it doesn't seem to make much sense for them to stop reporting things just because you've gone part time.

If this was your only taxable income you are probably due a tax refund even after taking into account the part time wages not yet declared by anyone.

Nations insurance is a different matter though.

Apollo114

My boss probably did it to cut the costs. Too bad he didn't inform me that I won't be paying my contributions anymore, and I was too irresponsible to check it myself.

I did in fact receive a refund from the HMRC for my overpaid tax...

When it comes to NI - who was then liable to pay it in such scenario?
I'm currently thinking about just asking him to pay the NI for me (there's a chance that he would be happy to do that). I'd rather not get legal with him since I don't think it would be worth it, and another issue is that he is a dodgy person. In fact I wouldn't mind paying it myself. I would really like to know whose fault it is, so I know what steps I should take now.

Dazed_and_confused

I did in fact receive a refund from the HMRC for my overpaid tax...

But presumably this only reflected the wages you were paid upto September 2018, so you will probably owe some of that refund back to HMRC.

If all that happened was you changed from full time to part time then I can't see why he shouldn't have just carried on reporting your salary and and deductions necessary to HMRC.