Credit card or debit card (or cash)

Band7

RG2015 said:

Rob5342 said:

jon81uk said:

I only use cash in the barbershop as they don't take cards. Not used cash elsewhere in the UK for a very very long time.

The only time I use cash is in the fish and chip shop as they don't take cards either, presumably so they can avoid paying tax somehow.

A fish and chip shop like any business has to pay tax on its taxable profits.

Evading tax is illegal and I am sure HMRC would catch up with them if they did this.

They could be just “careless” with their tax affairs. Apparently happens even to Chancellors and prime ministerial candidates….

Bridlington1

Band7 said:

RG2015 said:

Rob5342 said:

jon81uk said:

I only use cash in the barbershop as they don't take cards. Not used cash elsewhere in the UK for a very very long time.

The only time I use cash is in the fish and chip shop as they don't take cards either, presumably so they can avoid paying tax somehow.

A fish and chip shop like any business has to pay tax on its taxable profits.

Evading tax is illegal and I am sure HMRC would catch up with them if they did this.

They could be just “careless” with their tax affairs. Apparently happens even to Chancellors and prime ministerial candidates….

I must admit I was quite surprised by that one. I didn't know there were any chancellors left that wanted to pay less tax.

RG2015

I am saddened that people are maligning small businesses by assuming they are tax cheats without any evidence.

It’s like the despicable mantra that everyone on social security is a scrounger.

Rob5342

RG2015 said:

I am saddened that people are maligning small businesses by assuming they are tax cheats without any evidence.

It’s like the despicable mantra that everyone on social security is a scrounger.

The hairdresser we used to use was quite open about preferring cash as she didn't have to put all of it through the books

AmityNeon

RG2015 said:

I am saddened that people are maligning small businesses by assuming they are tax cheats without any evidence.

It’s like the despicable mantra that everyone on social security is a scrounger.

There are quite a few restaurants in a particular colloquially known area serving a certain type of cuisine that only accept cash and hire employees who have no right to work in the UK. So I’ve heard from former employees of these establishments.

MattMattMattUK

RG2015 said:

I am saddened that people are maligning small businesses by assuming they are tax cheats without any evidence.

It’s like the despicable mantra that everyone on social security is a scrounger.

Most, I would potentially suspect the vast majority of small businesses are entirely honest with their tax affairs, just as the majority of those who claim benefits do so legitimately. The issue however is that most people know at least one small business owner/self-employed person who fiddles things, just as many people know someone who fiddles the benefits system.

I run a small limited company, all expenses and tax are 100% legitimate, none even in any grey areas, my accountant double checks everything and on top of that we never get paid in cash as we are B2B. I know others limited company owners and self-employed people who claim for things that are not allowable, who inflate mileage, who sometimes take cash payments off book etc. and they do that to evade tax. In the past I worked for someone who did this, I told them I was not comfortable knowing that they were doing that, they asked me to help them so I quit the job and told HMRC exactly what they were doing and where all the bodies were buried, I even sent them screenshots showing the adjustments in the accounts and the conversations with the accountant on how to manage it all, HMRC did nothing, they did not care even though this was someone evading around £60k of tax a year as well as false accounting etc. Benefit fraud is the same, most people know someone who is gaming the system in some way.

MattMattMattUK

In relation to spending I only ever use my credit cards, either online or if in person via Google Pay. My debit card stays at home, locked in a fire safe and I only ever carry one physical card with me at a time. If I lost my credit cards then I can just cancel them, if they get stolen or cloned then the worst that happens is I loose temporary access to them until a new card is issued. With the debit card in the worst case someone could empty my bank account and leave me in a difficult position regarding bills, I could transfer money to cover them but that could cause problems if it the account was emptied right at the point my mortgage was due to come out etc. When it comes to cash I have not used it at all since 2019 and in the years before that my usage of cash was minimal, I still have £60 in my wallet which has been there since 2019.

The ones I really do not understand are the people who carry every card they have with them at all times, 1-2 debit cards, 3-5 credit cards, membership cards etc. and if they lost them they would have no access to money as well as the hassle of getting them all replaced. Even worse they often seem to carry cash with them as well which would be a further loss if their wallet was stolen. 

portersdelgadillo

Many people prefer to pay by debit card because it is easier to keep track of their expenditure. Debit cards are connected directly to the bank account and so you can monitor your balance in real-time. In addition, they don't incur interest or other fees like credit cards do, which can add up over time. Debit cards are also a good option if you want to limit your spending, as the money will be withdrawn directly from your account. Finally, some people choose a debit card because it is more secure than carrying cash.

MattMattMattUK

portersdelgadillo said:

Many people prefer to pay by debit card because it is easier to keep track of their expenditure. Debit cards are connected directly to the bank account and so you can monitor your balance in real-time. 

All credit cards these days offer near real time updates as well, as quick as debit cards. If I make a payment on my credit card it will be showing in the app within seconds.

portersdelgadillo said:

In addition, they don't incur interest or other fees like credit cards do, which can add up over time. 

Credit cards do not incur interest or other fees either, unless you leave a balance running on them past the due date which is basically the equivalent of leaving your current account in the overdraft. 

portersdelgadillo said:

Debit cards are also a good option if you want to limit your spending, as the money will be withdrawn directly from your account.

Running out of money in a current account would be the same as hitting the credit limit on a credit card, or running out on a pre-pay credit card, no benefit to the debit card in the situation.

portersdelgadillo said:

Finally, some people choose a debit card because it is more secure than carrying cash.

Using a debit card is more secure than carrying cash, using a credit card is more secure again, using Google Pay or Apple Pay is even more secure.

RG2015

AmityNeon said:

RG2015 said:

I am saddened that people are maligning small businesses by assuming they are tax cheats without any evidence.

It’s like the despicable mantra that everyone on social security is a scrounger.

There are quite a few restaurants in a particular colloquially known area serving a certain type of cuisine that only accept cash and hire employees who have no right to work in the UK. So I’ve heard from former employees of these establishments.

I accept that some businesses will keep income off the books to reduce they tax.

I was just objecting to an earlier post from @Rob5342 saying that his fish and chip shop only took cash, and he presumed that this was done to avoid tax.