Beaters Pay and HMRC

[ColinF]

People have also posted regardng claiming expenses, to do this you would have to register as a self employed beater and invoice the shoot for your services.Then you could offset any allowable expense against your income.Regarding allowable expenses and what is defined as allowable can get quite technical however HMRC have techs who can advise.

 

Hi Davyo,

 

The above is technically correct, but it's not as simple as just registering as self employed and invoicing the shoot. Due to the relationship between the shoot and the beater, I believe that HMRC generally views beaters as employees. This was confirmed in the original briefing note on beaters below:

 

http://www.hmrc.gov.uk/manuals/pommanual/attachments/briefing_note.doc

 

Although HMRC would look at the circumstances of each case individually, I think that a beater who claims to be self employed would have difficulty if they were challenged by HMRC?

[Davyo]

Can only be an employee if the shoot ops a payee system or has registered for paye.,I think as HMRC often do,they assume every shoot is an estate which would probably already be op paye.However a lot of shoots (small shoots)dont op paye for them to register under paye would be too much hassel & responsablility.So its a case of declaring income to HMRC to collect through your existing employers code.I think very few if any beaters would need to worry about being self emp as inc would not be over £2500.But beleive me because I have delt with them,some shoots are asking their beaters to invoice them?which classifies the beater as self emp regardles of the income.Remember its about declairing untaxed inc and the easiest way if your shoot does dosnt op paye is to contact HMRC as an individual and put it through your tax codes a restriction.If the shoot ops paye then they have a duty to notify under RTI (also remember that not all emps are using RTI at the moment)

*if shoots ops paye do nothing dont worry they should report your inc under RTI (if opperating) or the old paye if not.

** if they demand you invoice them ,they are telling you to be self emp.

*** if they give you cash in hand.you notify HMRC,if you have a current emp or pension they will code it out by including it in your code as a allowance restriction.THIS APPLIES TO ANY UNTAXED INCOME FROM EMPLOYMENT NOT JUST BEATING.

Edited December 13, 2013 by Davyo

[ColinF]

Can only be an employee if the shoot ops a payee system or has registered for paye.,I think as HMRC often do,they assume every shoot is an estate which would probably already be op paye.However a lot of shoots (small shoots)dont op paye for them to register under paye would be too much hassel & responsablility.So its a case of declaring income to HMRC to collect through your existing employers code.I think very few if any beaters would need to worry about being self emp as inc would not be over £2500.But beleive me because I have delt with them,some shoots are asking their beaters to invoice them?which classifies the beater as self emp regardles of the income.Remember its about declairing untaxed inc and the easiest way if your shoot does dosnt op paye is to contact HMRC as an individual and put it through your tax codes a restriction.If the shoot ops paye then they have a duty to notify under RTI (also remember that not all emps are using RTI at the moment)

*if shoots ops paye do nothing dont worry they should report your inc under RTI (if opperating) or the old paye if not.

** if they demand you invoice them ,they are telling you to be self emp.

*** if they give you cash in hand.you notify HMRC,if you have a current emp or pension they will code it out by including it in your code as a allowance restriction.THIS APPLIES TO ANY UNTAXED INCOME FROM EMPLOYMENT NOT JUST BEATING.

 

Davyo,

 

Whether or not the shoot has a PAYE scheme is irrelevant, they can still have employees. There are special rules for shoots who have employees, but none are paid above the LEL. Under these rules the shoot does not have to make submissions under RTI or be registered for PAYE, they just need to keep records of payments and the employee's details for 3 years. I have a letter from HMRC confirming this treatment. The details are here:

 

http://www.hmrc.gov.uk/payerti/employee-starting/special-situations/temps/harvest-casuals.htm

 

As far as I know, all other employers are required to report to HMRC under the new RTI system, so I am surprised that you say not all employers are using RTI?

 

The figure you quote of £2,500 is also irrelevant when deciding if someone is an employee or not. Self employed people can make a loss, but they are still self employed?

 

Issuing invoices does not make someone self employed. As you must know, HMRC will look at the circumstances of each case before deciding on a persons employment status, a guide to the type of things they look at is below.

 

http://www.hmrc.gov.uk/payerti/employee-starting/status.htm

 

If you look at the questions, you will see why beaters are usually employees. I would be very wary of a shoot that should be operating PAYE and RTI, but asks for an invoice.

 

Most commercial shoot, or shoots with a full time keeper, will be required to run PAYE. These shoots can either deduct tax in the same way as any other employment or pay their employee's gross under the special rules on the first link. Either way they will need to send details of the payments to HMRC via RTI.

 

Small shoots who employee beaters, but have no other employees, don't usually have to deduct tax or report the payments to HMRC.

 

It doesn't matter how beaters are paid, the income is always taxable.

[Davyo]

Sorry the figure of £2500 is the maximum of other income from earnings that can be included in an individuals tax code,this would if exceded £2500 put them in self assessment. This does not mean they are self employed it basically says they have to comp sa due to the income being over the coding limit.However if somebody you work for askes you to submit a invoice then you are self employes regardless of the income.

Shoots now are trying to work around the HMRC guidlines since it went to pubish by asking beaters to submit an invoice.I spoke to two such individuals in the first week of the season who had been asked to submit an invoice.We see the same thing with seasonal farm workers too.

RTI was trialed 12/13 with selected employer's and we hope that all emps will be using it by 14/15,however in the current year not all employers are opperating which is a blessing really if you could see the number of duplicate empoyments that have been created by employers submitting RTI data twice for the same employee.Employers a still learningas one mistake leads to a duplicated employment record.I will not mention names but today one of the big pension companies has just created duplicate pension records for thousands of its customers who have all defaulted to Basic rate tax, leaving them with no pension or a big deduction this week.

Edited December 13, 2013 by Davyo

[ColinF]

However if somebody you work for askes you to submit a invoice then you are self employes regardless of the income.

 

So if Tesco's told their employee's to submit an invoice, they would all become self employed?

 

Shoots now are trying to work around the HMRC guidlines since it went to pubish by asking beaters to submit an invoice.I spoke to two such individuals in the first week of the season who had been asked to submit an invoice.We see the same thing with seasonal farm workers too.

 

if shoots are trying to get around the rules by incorrectly categorising employees as self employed, I would have thought HMRC would want to take the shoot to task over it?

 

 

RTI was trialed 12/13 with selected employer's and we hope that all emps will be using it by 14/15,however in the current year not all employers are opperating which is a blessing really if you could see the number of duplicate empoyments that have been created by employers submitting RTI data twice for the same employee.Employers a still learningas one mistake leads to a duplicated employment record.I will not mention names but today one of the big pension companies has just created duplicate pension records for thousands of its customers who have all defaulted to Basic rate tax, leaving them with no pension or a big deduction this week.

 

I thought RTI was compulsory for all employers for 2013/14, have the employers who have not yet migrated to RTI got a special agreement with HMRC? The biggest problem for shoots seems to be the payroll software currently available. In order to comply with the special rules for beaters, they have to be hired and fired on the same day, which is one employment record. So if a shoot has 50 days, and 30 beaters each day that's 1,500 employment records by the end of the season. As far as I know, there is only one brand of software that can cope easily with this.

[Davyo]

Thanks colinf,we hope by 14/15 that all emps will be RTI linked it would make my job more easy due to no P45 as the last RTI submission would be classed as the P45 as would have a date of leaving date.This means we no longer have to issue an employer a P43 when an employee has not been given a P45 and is chasing a refund.The P43 forces the employer to send a P45 to us(which they should of done in the 1st place).However we have to give employers time to migrate so 14/15 is our target.

Thankfully they all haven't moved over which as I mentioned earlier becouse some employers payrolls have cocked up good and proper.I spent all day yesterday talking to pensioners that had been left with no monies of very little monies due to a simple error by their payroll submitting incorrectly.How they managed it is still being investigate but to give you an idication of how sensitive NPS/RTI is.Lets say you work for Mr Joe Bloggs, on week 35 he submits RTI date and you persoal payroll id is 12345, on the next week36 he submits but your payroll id appears as 1234 5.This will be recognised by NPS as a second employment with the same employer.

Regarding an emloyer asking an individual to work for them but on a self emloyed basis,this is becomming more common especially with agencies and loads of employers using the 0hrs contract rules.HMRC dont care if a employer who operates paye has a mixture of employees and self employed as long as RTI data is sent for those on payroll and the self employed worker declares earnings by completion of an sa return.Complicated I know but the responsablity is on the individual to pay tax.

An example of emp/self emp for the same employer.No names or employers mentioned,a teacher who works for an accadamy status school.(so used to be paid by local authority before the school became an accadamy)The school now is responsable for its own paye.A teacher calls me last week and states that she now has a second source of income with the school but has been told they must register as self emp.I ask her for a est inc to put on NPS as none coded income so NPS now knows there is untaxed inc to be declared by the teacher completing a tax return.I send of an SA1 to set her up as self emp.So now she has 2 jobs for the same emp,1 paye,emp takes care of tax.1 self employed where the teacher takes care of her own tax for this source.This is not uncommon and has been going on for years.

It seems there is now a trend for agencies to work a payroll similar to CIS construction industry scheme.Where the contractor askes the employee to register self emp so they can become a subcontractor working for the contractor.The contractor operates a CIS deduction sheet and gives this to the worker,like a payslip,the worker then uses this to complete their tax return.Its a bit of a minefield.

Lastly the reason the shoots are being advised to keep records for those under LEL is simply to leave a paper trail.For example lets say I beat in my spare time,but I also have a job and I earn above £9440(personal allowance) at my job.I then rec £25 for beating,I am responsable for notifying the tax office as 20% tax is due on the £25 because my personal allowance covers my main job income.The names and address ect can be used to check that the beaters are declaring the additional earnings.However if the beater only works part time and also beats the income from employment plus his beating wages doesn't exceed his personal allowance, therefore no tax is due on his £25.So if anybody beats its always good practise to notify the tax office.

Lastly if I was numb enough to give my shoot an invoice for my services I am clearly self emp in HMRC's eyes.

Edited December 14, 2013 by Davyo

[norfolk dumpling]

One big estate where I beat have declared that they have been given 12mths 'amnesty' from complying with RTI so beaters have assumed (ColinF I know what you are going to say so save your breath) that tax has been paid and are pocketing their £27 and forgetting about declaring.

 

I will declare along with wages where full details were taken and hope I don't drop everyone in the mire.

 

This shoot too has lost beaters and others have said RTI will see them stop coming - David Frost in this week's ST is wrong to say shoots are largely unaffected. I know of one shoot that has ceased because of RTI and at least 2 that have really struggled to replace beaters who have dropped out for no other reason.

 

It is the fear of dealing with The Taxman for those who have only ever been PAYE persons. We will survive, we are resilient but we will lose support.

[jayDT10]

I would suggest the only above board advice we can give them is to read http://www.hmrc.gov.uk/working/intro/casual.htm

Are you really suggesting that BASC or the Shooting Times advise people break the law.

 

The only one confused in this thread is you. All the other posters have been in agreement. Part time earnings, as we all know, no matter where they come from must be declared to HMRC.

 

Since every beater and every shoots circumstance are different it would be impossible and foolhardy for BASC to issue tax advice and for you admit to and recommend tax evasion on an open forum is plain daft.

 

 

But basically as you say, commercial shoots will put payments through the books whereas informal shoots will tend to fund beaters pay out of their back pocket which will be untraceable.

You are right, if you are asked for your NI number you will need to declare the income but it's also worth asking if they have an arrangement in place with HMRC to pay the tax on your behalf and what you are getting in your packet is the net amount after tax.

 

Don't forget that if your wife has any unused "allowance" left, there may be a tax advantage to pretend to be her when supplying NI details.............just don't forget to wear your frock when you sign in !!

implementing tax evasion on a open forum maybe daft but implementing fraud in order to avade paying tax is not, You sound pretty confused too. Lol

[ColinF]

HMRC dont care if a employer who operates paye has a mixture of employees and self employed as long as RTI data is sent for those on payroll and the self employed worker declares earnings by completion of an sa return.Complicated I know but the responsablity is on the individual to pay tax.

 

In my experience, HMRC are very hot on people who should be employed, claiming to be self employed. If HMRC weren't bothered, no one would have employee's and the country would lose out on a massive amount of Employers NIC at 13.8%.

 

The avoidance of Employers NIC was one of reasons that the IR35 legislation was introduced.

[CharlieT]

implementing tax evasion on a open forum maybe daft but implementing fraud in order to avade paying tax is not, You sound pretty confused too. Lol

If you didn't realise that was a joke, as suggested by my "wearing a frock" quip, then you are a bigger fool than I am confused !!

[jayDT10]

If you didn't realise that was a joke, as suggested by my "wearing a frock" quip, then you are a bigger fool than I am confused !!

the fact that I put lol on the end of my statement would suggest that I was just winding you up, ie having a joke. Guess you only get ya own jokes. No need for the name calling you fool. Lol Edited December 17, 2013 by jayDT10

[CharlieT]

the fact that I put lol on the end of my statement would suggest that I was just winding you up, ie having a joke. Guess you only get ya own jokes. No need for the name calling you fool. Lol

 

I have just learned something new.............lol made no sense to me so just asked my daughter who explained what it was.

 

My apologies to you sir

[ColinF]

If you didn't realise that was a joke, as suggested by my "wearing a frock" quip, then you are a bigger fool than I am confused !!

 

 

the fact that I put lol on the end of my statement would suggest that I was just winding you up, ie having a joke. Guess you only get ya own jokes. No need for the name calling you fool. Lol

 

 

You two think its a joke, but apparently the beating line on several shoots in Norfolk have looked like a Dame Edna impersonators convention this season.....

[PhilR]

 

 

 

 

You two think its a joke, but apparently the beating line on several shoots in Norfolk have looked like a Dame Edna impersonators convention this season.....

LOL

[CharlieT]

 

 

 

 

You two think its a joke, but apparently the beating line on several shoots in Norfolk have looked like a Dame Edna impersonators convention this season.....

 

Brilliant................can't wait to see the photo's.

[jayDT10]

I have just learned something new.............lol made no sense to me so just asked my daughter who explained what it was.

 

My apologies to you sir

 

no offence taken or made from my part I hope. it's all in good humour . I know what your saying about the lol thing as the first few times i see it sent to me from mates in text messages I took it as lots of love. Lol