A friend of mine carried out two days of work for a company and submitted an invoice for payment (a relatively small sum of less than £200).
The company has come back and asked to amend the invoice to add her UTR and NI numbers with a statement declaring she is liable to pay her own tax & NI. My friend is not self-employed and has never submitted a self-assessment (and therefore has no UTR), is claiming Universal Credit and is currently unable to work due to illness.
I understand the company wants this information to cover themselves but is it strictly necessary? I have suggested that she just updates the invoice with the statement saying she is liable to pay her own tax and NI but decline to provide a UTR and NI number. My friend however is worried that they won't pay if she doesn't provide it (the invoice is for work done quite a long time ago in a previous financial year but she only submitted the invoice this year, so the company is actually being accommodating by agreeing to pay it). She is also worried that registering as self-employed may affect her benefits. Due to illness and other factors, it is fairly unlikely that she has earned enough money this tax year to pay any tax (in this year or in the year she actually did the work).
Does anyone have any suggestions on what she should do? I know that probably both she and the company should have done their homework before engaging with each other, but it's all too late now!
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If the work was done after 5 April 2017 your friend should advise the company that as her income was below £1,000 she was not required to register for self-assessment. Whether that will work who knows. I appreciate that for someone in her position £200 may be a lot of money but at the end of the day it may be more trouble than it’s worth to try and recover it.
There's no requirement to provide that info but it's not uncommon, especially in the construction industry.
Even if the work was before 6/4/17, there was no automatic requirement to register for S/E dependent upon circumstances.
All that said, you can't really blame the customer for wanting to cover themselves on an issue like this, although not sure I'd bother for £200, and of course providing details like NINO is a requirement for PAYE.
I'd probably look to compromise in your friend's position by making the statement about being responsible for own tax (not that it really means much) & offering to provide the NINO but not on the face of the invoice if you're worried about data protection and your paperwork ending up in a wide open filing system (payroll depts to be fair to them are usually much better at that stuff where employees are concerned).
She needs to be very careful about the interaction with UC too. The £200 will be earnings and could reduce her UC in the assessment period in which she receives the money. It's very unlikely that she'll be classed as meaningfully self employed for UC. Her work coach will however be interested in her capacity for work.
It's ridiculous. It's taxation incorrectness gone mad. And yet we all tolerate the madness.
We're all responsible for our own tax, so a statement to that effect means what, exactly?
And a company using a worker is responsible for determining whether the contract with that worker is one of service. The contract is the contract. Self employed people can have jobs, so providing a UTR or whatever says what exactly about the contract?
You're right but none of us can make water flow uphill. If that's what the market generally believes is needed to provide some ar.se coverage (and it is), then the OP's friend is going to have to go along at least to some extent.
I agree, but what I don't understand is how the market came generally to believe such tosh.
Did someone once ask the question in an internet forum or something and the answer spread from there?
But why have the accountants acting for companies paying workers never corrected their clients?
I agree, but as it's been a long time since she did the work and the company are still agreeing to pay, for the sake of a couple of words on an invoice to make them 'happy' I think I will advise her to do it. If it were me in this situation, I'd probably push back a lot harder, but I am not in the same situation as her, financially, emotionally and health-wise.
Thanks all. The work was performed in Sept 2017 and was some basic marketing work, I believe (so not construction).
I think I will advise my friend to say that she generally gets paid by PAYE (she was also doing a small amount of agency work at the time on a zero-hours contract) and was below the threshold to register for self-assessment, therefore doesn't have a UTR but is happy to declare responsibility for tax and NI. That's also a good suggestion to offer the NI number but not on the invoice.
I believe you can earn £287 in a month before it affecting UC, so since it's under £200, I am hoping that should be ok.
And yes, it is a lot of hoop-jumping for a relatively small sum, but it's a lot of money for her currently.
There is a UC work allowance of £287 but it has to be agreed that there is limited capacity for work for that to apply . Unfortunately the receipt of £200 might suggest that there may be more capacity for work than limited. It'll all be down to the circumstances, hence the suggestion that you are careful here not to disturb the status quo.
Thanks. Hopefully her job coach will take into account this was for work performed in 2017.
Hello
If the payment was from an agency then they have to send an intermediaries report every QTR with either the UTR or NI number. Big penalties if not submitted by the agency.