Invoice Question

Buford T Justice

Hi Guys

Firstly, not sure if this is ok, but I'll ask the question anyway.

Last year I was a sole trader and for one reason or another I've stopped trading. I'm waiting until Jan to do my accounts for the months I was trading this year and de register with the revenue as self employed.

However, I did a job in january of this year for a guy I know well who gave me a lot of work. It was an insurance job for a water damaged property.

Anyway, I quoted him €10K and I did the work and got paid. Now he's trying to get the retention from the insurance company for the work done, and as I'm sure you can imagine the insurance payout for the damage is substantially more than what I charged for the repair.
He now wants me to do an invoice for circa 40 - 50K for the job saying its been paid in full so he can claim the retention for the job. I'm in a bit of a pickle because he's a close family friend.
I'm uncomfortable doing this because I don't know if I will end up landing myself with an income tax bill which I can't pay.

To put this in context, I'm unemployed and broke with a mortgage and kids at the minute. I'm not, nor was I vat registered either.

If I do this, is there a risk that I will land myself with a revenue bill and/or could I land myself up the creek.

I almost have to do this, unless its too dangerous for me. Self preservation of me and my family is more important.

Many Thanks guys.

slave1

I think you know the answer...

JD Dublin

Buford T Justice wrote: »

Hi Guys

Firstly, not sure if this is ok, but I'll ask the question anyway.

Last year I was a sole trader and for one reason or another I've stopped trading. I'm waiting until Jan to do my accounts for the months I was trading this year and de register with the revenue as self employed.

However, I did a job in january of this year for a guy I know well who gave me a lot of work. It was an insurance job for a water damaged property.

Anyway, I quoted him €10K and I did the work and got paid. Now he's trying to get the retention from the insurance company for the work done, and as I'm sure you can imagine the insurance payout for the damage is substantially more than what I charged for the repair.
He now wants me to do an invoice for circa 40 - 50K for the job saying its been paid in full so he can claim the retention for the job. I'm in a bit of a pickle because he's a close family friend.
I'm uncomfortable doing this because I don't know if I will end up landing myself with an income tax bill which I can't pay.

To put this in context, I'm unemployed and broke with a mortgage and kids at the minute. I'm not, nor was I vat registered either.

If I do this, is there a risk that I will land myself with a revenue bill and/or could I land myself up the creek.

I almost have to do this, unless its too dangerous for me. Self preservation of me and my family is more important.

Many Thanks guys.

If you issue this invoice, the insurance company will certainly question it - 40k gets you a lot of building work. When they do that, you are in deep water.

If this person was a genuine friend, they wouldn't ask you take this risk.

There is a very strong chance that the insurance company will not pay out, and will infer that you are not a reputable person. Then yourself and your friend are bunched because your good name will be gone.

I know from dealing with insurance companies, they are a bunch of crooks who will do anything to get out of paying a claim, and overcharging them is one sure way for it to happen.

smcgiff

JD Dublin wrote: »

If this person was a genuine friend, they wouldn't ask you take this risk.

With Friends like this...

Your friend is taking advantage of you - although I imagine there's a promise of a backhander from the €40k extra, mmm.

If you think an insurance company is going to pay out €50k and not want every penny proved (and a paper invoice from the insured's supplier isn't proof) then did you get very wet last Monday when you came down in that shower

Revenue is the least of your worries -as, ultimately, you pay tax on the paid amount. And you're not going to be paid this money. However, this would also be fraud (you're trying to defraud a company of €40k) and that's not a slap across the wrist if you get caught.

Don't do it.

RT2010

smcgiff wrote: »

With Friends like this...

Your friend is taking advantage of you - although I imagine there's a promise of a backhander from the €40k extra, mmm.

If you think an insurance company is going to pay out €50k and not want every penny proved (and a paper invoice from the insured's supplier isn't proof) then did you get very wet last Monday when you came down in that shower

Revenue is the least of your worries -as, ultimately, you pay tax on the paid amount. And you're not going to be paid this money. However, this would also be fraud (you're trying to defraud a company of €40k) and that's not a slap across the wrist if you get caught.

Don't do it.

+1

Asking for trouble if you do this. Insurance Co's are dealing with cases like this everyday and know all the tricks!

tenchi-fan

If you do a bill for €40k, revenue will probably want to know why you weren't vat registered, and one way or another (whether your company has ceased trading or not) they'll probably go after you.

Also, when the insurance company do a bit of digging they'll likely take you to court and you'll be prosecuted for insurance fraud.

Shame on you for even thinking about doing this.

Buford T Justice

Cheers guys... You've told me everything I needed to know.

P.S. There's no mention of me getting a backhander to do this, so no financial incentive. Aside from the moral aspects I wanted to know the dangers around this and now I do.

Thanks guys.