Tax position for a street hustler
Prospective client came to see me recently about starting a business but has for many years been a street hustler at footbal grounds, race tracks etc generally working as part of a team to hustle punters with slight of hand games like find the picture card etc. Therefore no proper tax record for many years.
Now wanting to go legitimate with HMRC but before notifying HMRC wanted to know what the tax position is on the many years he has been street hustling. Would this been seen to be a trade where chargeability to income tax existed?
Your comments are much appreciated. Thankyou.
Trading?
I'm not convinced that the Revenue would want to know. It depends on the nature of the hustle. You have a spectrum here. Gambling (poker etc) is currently not taxable face to face or online, even if you are a skilled professional. The reasoning for this is that it is a game of chance which would be news to those I know who actually make a living at this. So if you tell the Revenue that the guy is making a living from money made at card-games, their line should be to shrug and say 'what are you telling us for?'
But if they are cheating in the games that they play, then that becomes fraud (although it's the same kind of fraud that's practised by banks who make their more attractive interest rates disappear when you're not looking). As such it would be criminal and taxable.
Must update
My recollection of the whole gambling thing was that the Revenue were very reluctant to take on board the idea that someone was trading as a professional gambler. Although they'd gain tax take from those who did make money it implied that those who lost money would then be entitled to claim losses. You can read the poker players viewpoint on this at:
http://www.thehendonmob.com/forum/viewtopic.php?t=33778&postdays=0&postorder=asc&start=15
and without wanting to advertise the opposition......
http://www.taxationweb.co.uk/forum/professional-gambler-income-tax-t1201.html
We have a strange system at times .......................
If he registers for tax the first thing that will happen is this "gap" in his records will come to light.
Now daft though it sounds, if he was claiming benefits as well as street hustling, the odds are it will not ring any alarms and he will hear nothing more.
However, if he was street hustling and lived off that without also illegally drawing benefits, he will almost certainly find himself under scrutiny.
Yet again it seems that total dishonesty pays whereas semi dishonesty doesnt.
And YES, it is a trade for tax purposes. This government doesnt worry about whether its legal or not, so long as Gordon Brown & Co get their cut.