Non Tax Payers?? WHO R THEY??

solidstan1 · 29th June 2006, 15:15

I have been looking for a new savers account. On many Banking websites I read this:-
" If you don't pay tax, you'll need to complete and send us HM Revenue and Customs Form R85 to ensure your interest is paid gross."

Who would this apply to??
I receive TAX CREDITS does this apply to me??

Many Thanks in advance..

pmhread · 29th June 2006, 15:17

do you pay tax?

solidstan1 · 29th June 2006, 15:32

I Work minimum hours, and on low wage.
I recieve Tax Credits.

pmhread · 29th June 2006, 15:37

What are minimum hours? Tax credits are irrelevant on the question of whether you pay income tax or not.....

We get tax credits but we get battered by Mr Brown each and every month.

solidstan1 · 29th June 2006, 16:02

OK then.
The Full story!

I drive disabled people to Day Centers in the morning & home again in the afternoon. (16hrs a week)
It is volunteer work of which I recive £70per week.
It is then toped up with £25per week with tax credits.
So why would I pay tax if the tax man pays me?

Do I have to pay tax on my bank account??

pmhread · 29th June 2006, 16:10

You get paid for volunteer work.... aarrgh this is so confusing...

Right, do you drive your own car... and if so is the £70 per week to cover these expenses or is it a wage... if it's a wage then your not a volunteer...

Why does the tax man pay you to pay him... because that's what tax credits are for. I earn a decent wage and still receive tax credits but that doesn't stop them taking a fortune off me every month in tax.

You have to pay tax on the interest earned in your bank account.... unless you have several thousand pounds in there I would forget about it.

solidstan1 · 29th June 2006, 16:26

It is a charity taxi service.
My boss/friend gives me £70 per week cash for driving for him. (his car)
I supose he gets paid in way of grants (i think)
I filled in a tax credits claim form saying I work 16hrs earning £70 per week.

I have 35,000 in bank (just sold my house).

Im very confused.

Why would you pay him if he pays you. (would'nt he just take less off you or you pay him less) if you know what i mean??

pmhread · 29th June 2006, 16:31

So you get paid cash in hand? If that is the case then no you won't be paying any tax however I would be careful about what you are getting into if you have declared to the DWP that you work 16 hours a week. You and your boss could get into trouble. You might need to have a little conflab about this to make sure you are 'on the books'.

Maybe you should go and have a think about whether you pay tax or not and then come back when you have the facts.

katielawrence1987 · 29th June 2006, 18:49

I sent that R85 form in because I am a student earning less than £4700 a year, which is the amount that is tax free. If you earn over this amount then you pay income tax.

In your case however im not sure if it is as straight forward as this.

katielawrence1987 · 29th June 2006, 18:54

Also, I think that if your income from your interest pushes your yearly income above £4700(ish) then any interest earned after £4700 is then taxed at 20%.

I would also like to say that dont feel too rushed in getting your R85 form sent because if later on you find out you can get your interest tax free then you can claim it back, not from the bank but the tax man.

dw190 · 29th June 2006, 19:06

Quote:

Originally Posted by pmhread

So you get paid cash in hand? If that is the case then no you won't be paying any tax however I would be careful about what you are getting into if you have declared to the DWP that you work 16 hours a week. You and your boss could get into trouble. You might need to have a little conflab about this to make sure you are 'on the books'.

Maybe you should go and have a think about whether you pay tax or not and then come back when you have the facts.

He may be paid Cash in Hand but on an amount of £70.00 per week he would be below the Single Persons Threshold. Take a look:

http://www.hmrc.gov.uk/pbr2005/pn02.htm

pmhread · 29th June 2006, 19:09

Quote:

Originally Posted by dw190

He may be paid Cash in Hand but on an amount of £70.00 per week he would be below the Single Persons Threshold. Take a look:

http://www.hmrc.gov.uk/pbr2005/pn02.htm

I'm well aware of the tax bandings thank you very much. The problem is if it is cash in hand then he/she has made a fraudulent claim to the DWP for tax credits.

dw190 · 29th June 2006, 19:17

Quote:

Originally Posted by pmhread

I'm well aware of the tax bandings thank you very much. The problem is if it is cash in hand then he/she has made a fraudulent claim to the DWP for tax credits.

No he's not he told them he gets paid £70 per week for 16 hours work.

My boss/friend gives me £70 per week cash for driving for him. (his car)
I supose he gets paid in way of grants (i think)
I filled in a tax credits claim form saying I work 16hrs earning £70 per week.

pmhread · 29th June 2006, 19:21

Cash In Hand!!!! Who Is He Employed By? Does The Boss Even Have A Company/payroll/employee Liability/public Liability? Are The Patients Being Transported In An Uninsured Car?

dw190 · 29th June 2006, 19:30

Quote:

Originally Posted by pmhread

Cash In Hand!!!! Who Is He Employed By? Does The Boss Even Have A Company/payroll/employee Liability/public Liability? Are The Patients Being Transported In An Uninsured Car?

That's not the question.

The question is liability to tax on a savings account

My boss/friend gives me £70 per week cash for driving for him. (his car)

pmhread · 29th June 2006, 19:33

Look... I was merely warning the person that if they are paid cash in hand and they have made a claim then it is a fraudulent claim.

dw190 · 29th June 2006, 20:38

Quote:

Originally Posted by pmhread

Look... I was merely warning the person that if they are paid cash in hand and they have made a claim then it is a fraudulent claim.

Its quite clear from reading again

He gets paid £70.00 per week which is below the threshold for Tax & NI (No Liability to Tax or National Insurance)

He declares this £70.00 as an income when claiming tax credits )In this case honesty pays), because on an assessment of his declared income he receives Tax Credits in the sum of £25.00 per week.

The fact that he receives the money cash in hand is irrelevant. Many are still paid in cash. The only thing that may be missing, but has not been mentioned is a payslip.

Its up to his boss/paymaster to complete any paperwork relating to employment.

The interest on his £30,000 may take him above the threshold for income tax depending on the amount of interest.

pmhread · 29th June 2006, 20:40

if you say so

he is paid under the minimum wage which would suggest to me he is working cash in hand.... in effect he works for no-one yes.... you only get tax credits if you work for 16 hours or more yes....

This is what I'm getting at.... I'm well aware that he doesn't earn enough to pay tax/national insurance.

Probably my fault for not making it clearer but does that make my point understandable... That being he is unlawfully claiming tax credits as he doesn't actually "work" for anyone which is why there could be trouble. If tested both him and the person who pays him will find that ignorance is not a defence in a court of law.

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