Builder using cash labour

Builder using cash labour

Didn't find your answer?

Evening

A builder in his first year of trading (through a Ltd Co) has been using cash labour for one off jobs despite knowing about needing to verify each guy under CIS.  No invoices have been received for the works and obviously no tax deductions have been made.  Nearly all of the work carried out is for domestic customers. 

What is the best way to treat this - to his DLA? 

Thanks in advance.

Replies (3)

Please login or register to join the discussion.

By ShirleyM
22nd Oct 2014 07:40

Yes

Put the costs to the DLA.

What is his attitude? Will he get invoices and verify the subbies, or will he continue doing this? If so, I would submit an MLR report and get rid.

If he gets caught, it's guaranteed he will say his accountant knew about it, and ok'd it! What else is he doing, and will he expect you to 'manage' the risk?

Thanks (4)
Euan's picture
By Euan MacLennan
22nd Oct 2014 10:23

Agreed

... and, incidentally, "Nearly all of the work carried out is for domestic customers" is irrelevant.  The builder is not subject to CIS on his work for homeowners, but he must still apply CIS to his sub-contractors.

Thanks (2)
avatar
By DMGbus
22nd Oct 2014 14:08

Domestic customers relevance

A long shot, but let's have a go:

If the CIS work was carried out for domestic householders, then the labour COULD be outside the scope of CIS if, and only if, contractual arrangements were properly put in place.

Example.

John is a kitchen fitter, he does NOT have GasSafe certification so if a gas cooking appliance is involved he cannot do the gas part himself.  He has a friend Mick whi IS GasSafe certified, so here's an option:

The RIGHT way sidestepping CIS):

Mick says to customer: I am NOT Gassafe certified so I'm not allowed to do that part of the job.  Therefore I will bring in Mick who can do the work for you.  Please can you pay him direct.  If you prefer NOT to pay him direct, then I will will handle the payment for you (it will be a disbursement).  You can pay me the cash and I will pass it in full to him, I will not make anything out of Mick's work.

As I said a long shot but worth considering.

 

Thanks (0)