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TaxRobin
TaxRobin, Tax Consultant
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Experience:  International tax
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My wife has her own business which I have nothing to do with.

Customer Question

My wife has her own business which I have nothing to do with. Everything in my marriage house car is is my name. Just her business is in her name. She is new to business and doesn't want to pay tax. Its coming to the end of Jan and I've been urging her to sort it out to submit but she has said she is only going to declare part of her business as she is a sole trader doing two business side by side. She is from the middle east and claims no-one in her country bothers with tax and she feels angry that she has to pay it. Its her business - I can only advise her.
What I want to know is - what is likely to happen to her if she doesn't pay her tax properly or at all? She has only had her business 1 year and a half. It was doing well but not so well any more.
Also
What is likely to happen to me as her husband? Will this affect me? My finances or my 2 homes that I completely own in my name?
Submitted: 11 months ago.
Category: Tax
Expert:  TaxRobin replied 11 months ago.
HelloThe process of collections can be drawn out but as a creditor, HMRC can petition the court to put a company into liquidation or to make an individual bankrupt to settle tax debts. This is permitted even where an assessment is under appeal and awaiting a tax tribunal hearing, where collection of tax is not postponed.New rules in Finance Bill 2015 will allow HMRC to recover debts of more than £1,000 directly from a taxpayer’s bank accounts from 6 April 2016 onwards.Generally, you will not be held liable for the business debts of your spouse as long as you did not open the company accounts jointly. About your 2 homes, if your spouse has contributed to the purchase of the property, the repayment of the mortgage or the improvement in the property then they will investigate. If none of those things have happened then HMRC would have no interest in your property.You are right to caution her about the implications.
Customer: replied 11 months ago.
Ok thanks. After a number of years eg 5 -10 years she can have a claim on my finances in a divorce financial settlement sence - we are not getting a divorce so she won't be looking into this. Would HMRC not look at her and think she has a claim on my properties?
Expert:  TaxRobin replied 11 months ago.
Any claim due to divorce would not be relevant when looking at her business tax debt and liability.HMRC looking at a potential claim by marriage alone is going beyond the point.The profits of her business would need to have been used to purchase or improve the property.
Customer: replied 11 months ago.
1 more thing is that she has been using my personal ebay account to buy and sell stuff - but accepting profits through her own paypal. The only other thing that could connect me is that I bought a computer for her business but this was really a present. Any problems here?
Expert:  TaxRobin replied 11 months ago.
Not so far. As long as you are not listed on her activities then the one purchase you made for her is not enough to place you in danger for her noncompliance.
Expert:  TaxRobin replied 11 months ago.
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Customer: replied 11 months ago.
THe only other thing that I can think of is that she has contributed to household food occasionally every month. is this a problem?If she misses the end of Jan online deadline for self assessment what will happen?
Expert:  TaxRobin replied 11 months ago.
Her contribution to the food for the household is not the same as paying for the property itself.She will be penalized. She will get a penalty of £100 if her tax return is up to 3 months late. She will have to pay more if it’s later.
Expert:  TaxRobin replied 11 months ago.
I hopethat information is helpful
Expert:  TaxRobin replied 11 months ago.
.

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