Saturday, 28 January 2012

Taxed to death.

The Ranting Penguin notes that the taxman is going to chase all we little people for our pennies while letting the big corporations keep their pounds.

The taxman believes that the use of cash is, in itself, a tax dodge. One more step to the cashless world, in which every transaction is taxed electronically and we don't know how much tax we're paying any more.

So who are the culprits here? Not me, because the nature of my work does not allow for cash transactions. If someone wanted cash-in-hand microbiology work I'd be very wary indeed. The books, I could sell for cash, but in reality they're sold through booksellers. Sometimes I sell a signed copy but that's by cheque or PayPal. I can't make cash sales unless I try selling door-to-door!

Who, then, are the taxman targeting this time?

Paying a builder or cleaner in cash, allowing them to evade VAT or income tax, will result in even deeper government cuts to public services, he says.

Cleaner? I've been looking at cleaner jobs and if a cleaner is even making enough to pass the tax threshold, I'd be amazed. You don't see many cleaners turning up for work in BMWs. So the taxman is going after minimum-wage earners while letting the big corporations off with billions. Paying a cleaner with cash doesn't matter at all. The tax loss is trivial, if there even is any.

Builders might make enough to show a difference but I suspect that if you took all the cash-in-hand work done by all the builders in the country, the tax loss wouldn't even touch the amounts those big businesses have been allowed to forget about.

I have a tax bill that's going to clean me out and yet it wouldn't cover an MP's monthly expenses. If I didn't pay it, there would be no cuts to services at all because it won't cover a single employee's wages. And yet this is the level the taxman is planning to attack with fines that will blow most small businesses right out of the water and put all those taxpaying workers on the dole.

Many small business owners are giving up and going back into waged employment because the government is doing its damnedest to destroy them. The array of fines a business can now face is astounding and those include fines for things that aren't even illegal. Such as not putting a sale in the ledger until the following day. There is no tax dodge there, all the money is accounted for, but if you don't fill it in in 'real time' they'll fine you £3000.

Then we have 'tax on account' where we have to pay next year's tax this year. If you are thinking of starting a business, be aware that at the end of your first year you will pay double tax. Then the tax office will report that most small businesses only last one year and will never make the connection.

Eventually we will all be working for a big corporation or we will be on benefits. There will be no small businesses and no more innovation. Corporations will stick to their tried and trusted sales, only upgrading current products and not bothering to develop anything new. Why take risks when there's no competition?

If Steve Jobs was a teenager today, building little computers in his garage, nobody would ever see an iPhone. The taxman would have eradicated him before he had 'Apple' listed as a trademark.


ArtCo said...

Well that's me left with fuck all again too, that is the final straw ,Ive had enough and now its time for me to start taking a bit back. Black economy and the dole here I fucking come.

mrs.raft said...

My experience of builders and plumbers is that they don't in fact work cash. Not even my window cleaner does because many people want a set of clear accounts against which they can get a property. 

Paul Robson said...

The reason why ; it's easier to go after the small guys, they don't fight back. My accountant has a string of truly pathetic tales about HMRC demanding costly things off small businesses that wouldn't cover the cost of a cup of tea. Even if you aren't fined you have to pay the costs of dealing with the barstewards.

And it's getting worse ...... and there's all the f***** monitoring bodies that have no use at all ..... and pointless costs to satisfy government .... and endless extra taxes ..... and endless new employees rights (what about some bl**dy employers rights like for them to turn up and/or do something ?)

The tax on account really hacked me off too. Even if you were up and running, it was still paying 2 lots in one year.

I think you are actually behind the times ; why anyone runs a small business or employs people in this f**king country is beyond me.

Thomas said...

It makes me think this, in the longer term and larger picture - if they can outlaw cash and force everything electronic, it eventually paves the way for the ultimate "convenience" of having it all microchipped in one tidy package and injected on either the hand or forehead. At that point, it will be something "good" (making it convenient) and something "democratic" (since there will be a choice - hand or forehead).

Amusing Bunni said...

THey do the same crap out here, LI.  I can't see why anyone would want to own a biz these days....the gov't takes all the money and profit  from it.  That's why there is no economic recovery out here, so many regulations.  People with some money who might want to open a biz are waiting until after elections in Nov, because they know if o gets in again, there is NO POINT in working for yourself at all.

As for the day that is coming that Thomas said below, when that day comes, you'd all best refuse, because that is the "mark of the beast", and if you get that, you're doomed for eternity.

Chris Woods said...

Some small trader busineses round here have reverted to self employed with no other staff, or split the job with another self employed mate (who would have been an employee) then they can all unregister from VAT and tick over while keeping their turnover under the vat limit. For bigger jobs the customer buys all the materials and they just fit or build so their turnover stays low.

Anon said...

More and more are happy with cash if, like so many I know, they are in rented property.
I even know of some who ask pensioner relatives to claim some of the earnings - they still have to pay tax but they keep the income down for the various benefits available!

Legiron said...

I'm thinking of just taking a standard job too. There's no point finding cures if the hospital admin are just going to block any attempts to use them.

Legiron said...

Good point. If they need a loan of any kind, they need to present their books. Pretending to earn less would mean they'd be offered much less on a mortgage.

Legiron said...

I won't be employing anyone, that's for sure. The paperwork involved makes it impossible. I'm now thinking 'sod it, I could be a shop manager and not have to be up to my elbows in filth, and make the same money'.

Legiron said...

It also means that fines can be deducted as you pass a scanner, and if you really annoy the authorities, they just turn off your chip.

Legiron said...

Once they chips are in, it's total control time.

Legiron said...

VAT is the reason I don't sell Ebooks direct. They all go through booksellers. I could, my contract with the publisher allows it, but Ebooks attract VAT and that is something I am staying well clear of.

Legiron said...

It's now the only sensible approach. The government and the taxman are only interested in fleecing us. All this talk of 'services' when they give billions away is just nonsense. They are not interested in 'services'.

JuliaM said...

Paying a builder or cleaner in cash, allowing them to evade VAT or income tax, will result in even deeper government cuts to public services... "

Cool! Thanks for the tip! :D

Lou said...

I see this from another angle. Lots of Brits have settled in Spain, Cyprus, some Greek Islands and so on. Sort of a community within, with their own clubs and networks. Most handymen don't declare a thing (cash, one Brit to another) to the Revenue people and more than a few make sure they don't pay any taxes of any sort.

It's partly because of this free movement of people that the EU started this business of withholding interest at source on deposit interest (though that source has dried up as there's sod all interest paid and people have sussed ways round it).

I know that within the Bengal and Lebanese communities in London the same attitude exists and I suspect it's the same throughout the UK.

Last summer I had a Polish guy do some painting and a Scots guy give my roof (in the Lothians) the once over. It's always cash and I never ask for a receipt. If they give one then that's their decision.

Deals like these are every day things; the mechanic who changed my engine oil runs a legitimate business, but I suspect he had the brains to keep the 20 quid rather than 16. 

LI I've long argued that there are lots of ways to show displeasure at corrupt government policies. Not voting is one and in a perverse way I can understand the logic. That old maxim "No taxation without representation" helps explain why so many people have refused to register to vote or simply chose not to. It certainly helps justify evading tax.

Taking the last Scottish Parliament elections, about 50% refused to vote. Speaks volumes (quietly).

Melvin Grayconcern4justice said...

The most inquisitive kids independently conduct that experiment of poking a folded comic into the glowing element of an electric fire. They learn nothing from the small shop fire because they emerge as adults who create companies, register for VAT and take employees onto the books.

Legiron said...

I had forgotten the fun of poking things into electric fires. Must get one.

Kitchen Taps said...

VAT is simply another word for robbing you!!!

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