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Sam
Sam, Accountant
Category: Tax
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I'm self employed mechanic in UK. Most of my income comes

Resolved Question:

Hi.
I'm self employed mechanic in UK. Most of my income comes from company based in Jersey, Channel Island. They buying and selling cars, mostly in UK. For their own convenience they rent an agricultural shed in UK, where they keep some cars for sale. My role is to maintenance those cars and show them to UK costumers - strictly by appointment
My question is, did they should pay UK tax on cars sold in UK that way? Did I'm taking part of some illegal activity ?Kind Regards
Chris
Submitted: 28 days ago.
Category: Tax
Expert:  Sam replied 28 days ago.

Hi, Sam here , one of the UK tax Experts here on Just Answer, thank you for your question and I shall reply shortly

Expert:  Sam replied 28 days ago.

HI

The first issue is that you should be an employee of this company and NOT self employed and also note that VAT is due on sale of used cars - see link here re the Margin scheme

https://www.gov.uk/government/publications/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles

And as they have a presence in the UK - yes they should be running this business entity through HMRC for appropriate taxation on the business profits as this is deemed to be a UK presence and business but this is their issue rather then yours other than the fact you should be employed by them and due holiday and sick pay as appropriate

Let me know if I can assist further

Thanks

Sam

Sam and other Tax Specialists are ready to help you
Customer: replied 28 days ago.
Hello.
Thanks for quick reply
I'm permanently live in UK so I prefer to be self employed here rather been employed by them in Jersey. I live here and I want to pay tax and social security here in UK
I'm sure company or costumer pays VAT on cars previously registered abroad - its part of car registration process . What's worry me is the fact that's place I'm working ( maintaining those cars and meet the costumers and show them cars for sale) it's not a registered business in UK. They don't want to have any "tax footprint" in UK. In the UK it's just me.
Far as I understand, If they selling cars in UK, from UK premises, even If they don't have any registered business in UK, they should pay some kind of income tax in UK. Is that correct ?Ones again thank for all your help
Greg
Expert:  Sam replied 28 days ago.

HI

Its not a matter of choice whether you are self employed its a matter of law and as you only have one cleint use their cars to work on and their shed - you are an employee

You are their UK footprint as you exist working on their behalf with their cars and customers, if acar is returned do you have to pay the customer back out of your money, do you mark up the price of the car so you make the profit? NO so you are merely a representative between the business and the customer using their business head and equipment and only having this one "client" so cannot be self employed.

And as they have a presence here in the UK create their own footprint anyway

Yes they should be paying UK tax as already advised both for you and for VAT and for businesss

Thanks

Sam