Horsey moral dilema

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FairyLights

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Input needed folks. An aquaintance of mine moved last year to a smallholding. They are renting out stables and also using building to store equipment needed for their buisness. They are self employed. Basically husband does the work and employes his wife to do a bit of admin,paying her just under the tax threshold,in essence its a tax avoidence vehicle. They do not ,as far as I know, tell the inland revenue that they are renting stables out to livery people,its all cash in hand [ I know one of the liveries].nor do I think they pay business rates as the council,as far as I know, thinks its just a house with no business. They have children and I expect they are claiming child tax credits.
So, should I let them carry on or should I "shop" them to the council? I feel mixed about this, I am annoyed me and husband,who are employees have to pay a lot of tax and NI andd they seem to be getting away with stuff, a lot of his business is cash anyway,but I would feel a sneek if I shopped them and also my frind may loose her stable if they shut down the livery side.
 
Personally, I wouldn't. People like that do drive me mental but I think it would be bad karma to shop them.
 
No!!!

Business rates will finish them off. We declared we were running the livery yard and I wish I hadn't now. I only have 5 livery spaces (4 liveries at the mo, and have been down to two in the past but have to pay out business rates of £200 per stable plus over £2000 for the arena and £1500 for the sand turnout. It nearly broke us as we had to pay for arrears too and we almost had to sell up. If they are renting the stables out DIY the rates will amount to more than they are taking.
 
Incidentally, you have to pay business rates even if you receive no money from the people using your stables. It's ridiculous.
 
Even more of a reason not to imho! (Wagtail's post) God knows there are few enough affordable DIY yards around.
 
Im with Wagtail, you shouldnt shop them, yes it is annoying when people appear to be getting away with things, unless your whiter than white and can live with the fact that your actions could push them financially under now while we all suffer in these hard times!!
Sounds like they are just trying to enjoy their smallholding and bring up their children, im sure the tax man will catch up with them at some point if they are in the wrong but why should it be you to burst their bubble?
 
Very interesting replies. How would you feel if horses were not involved though? Lets say they were doing a kenels and B&B,raking in the cash,screwing the tax payer [ me and you] and living the high life whilst we struggle?
 
what kind people not to be vindictive!
how about not shopping them but giving the hint that someones talking about the situation and see what they say, they might be able to justify what they are doing, they may be declaring more than you suspect, if not they will have the chance to put things on a different footing, like declaring more before there's a big problem
 
Tax avoidance is not illegal, so nothing to shop them for there.
You could shop them for not paying rates... and not declaring the livery income...
the rates would be a fair do, I suppose, but I'm not sure what you would like to achieve by that. And are you sure they are not paying them?
not declaring livery income... do they make money or running at break even/loss? The taxman might consider it a hobby not a business, or they might get in trouble. Again, what would you get out of it, though? would it make you feel better?
 
Agree with Martlin, what do you gain from 'shopping' them? It looks as though the green eyed monster is sitting on your shoulder. And how do you know the details of their finances, through hearsay? O, I see.
 
Notjustforxmas said:
Very interesting replies. How would you feel if horses were not involved though? Lets say they were doing a kenels and B&B,raking in the cash,screwing the tax payer [ me and you] and living the high life whilst we struggle?
Click to expand...

I don't think any of those professions are raking in the cash. I would say the same thing. Don't shop them. Times are hard enough for self employed people.
 
The people that get me are the ones with ten children who are claiming £100k plus a year in housing benefit, or the ones that are supposedly disabled but are not. They are the ones draining the economy. At least these people are supporting themselves, and if they are 'raking it in' then they won't be claiming child tax benefits.
 
Wagtail said:
The people that get me are the ones with ten children who are claiming £100k plus a year in housing benefit, or the ones that are supposedly disabled but are not. They are the ones draining the economy. QUOTE]

Blimey Wagtail, this isn't the Daily Mail website y'now! ;)
Click to expand...
 
I still hold by my previous post, like Wagtail has said self employed people are atleast trying to support themselves, you dont know what they are declareing to the authorities, nor should you its really nothing to do with you. If they are claiming tax credits like many people are then they will be having to produce accounts and im sure if they are raking it in the council will soon be on to them without your input.
 
I think the posts/ replies on here are excellent. TBH if you were in the same situation as they are, would you do the same? I would. I agree with tristar, sound them out that people are aware of what they are doing. There is nothing wrong with paying his wife just below the tax threshold, it is a means to an end and as someone else said there are far too few cheap livery yards around! I can't really add anything to the previous posts other than I wouldn't open my mouth, live and let live.
 
My Dad (not a YO but self-employed) paid my Mum to do his admin for years. In the days before faxes, mobiles etc there was actually quite a lot of work to do and it allowed her to have her own pension even though she had a long career break to look after us while my Dad travelled for his job. If they are running a (small) livery yard then there will be a fair bit of admin so I'd say that was tax efficiency not avoidance/evasion.

Having said that income should be declared and a business is a business and should be taxed/insured etc as such.

I know of at least two instances of people running mechanic's workshops as 'hobbies' which blighted the lives of neighbours who would have been able to complain if the businesses were classed as such (in fact they might not have been able to be run).

If you are personally disrupted by the liveries and deliveries coming and going and so forth I could see the point in reporting this couple.

If it is just a question of guessing about their tax returns and so forth... that is a harder call.

ETS when we were older and techie stuff was more advanced my Mum got another job and was no longer paid by my Dad - basically they were straight about it. This cple cd be on that issue too!
 
I'd suggest that they are doing the best they can in terms of tax efficiency. If they're running the smallholding as a business, you can be sure every item spent is allowed for from the income, and thus tax is only paid on the profit. Why not ask if they can recommend an accountant?

Mine is certainly worth the £1K I pay him a year - this year I thought I'd be paying a lot in corporation tax - but following his advice I paid just 10% of the amount I'd roughly calculated.
 
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