Covid payment for Cash employees

Joe Exotic

Hi Quick Question my friend was childminding for cash and that employment ended because of Covid (The childs Mother stopped working).

My friend applied for and was granted Covid payment. Yesterday she recieved an email saying they have no record of income from revenue and looking for clarification.

This is obviously because she was being paid cash. (but not claiming dole etc.)
Her payment was well under the tax threshold but she still wasnt reporting the income.
I assume this will mean she wasnt entitled to the payment (Lack of declaration) and will have to return any monies ?

I have tried to look on Citizens information but while it mentioned "casual" employees im not sure thats what it means.

Is anyone able to confirm that she is not entitled to the payment (She is replying to the email today but is really worried)?

If she has to pay it back i assume she can then retrospectivley apply for unemployment for the period?

Thanks for any help or info you cana provide

GerardKeating

Not only might you friend have to repay the covid payment, she might be stung for the undeclared incoming, even if no PAYE was due, perhaps some PRSI or USC.

Joe Exotic

GerardKeating wrote: »

Not only might you friend have to repay the covid payment, she might be stung for the undeclared incoming, even if no PAYE was due, perhaps some PRSI or USC.

I know havent mentioned it to her yet (one worry at a time).

Id reckon she would owe a tiny amount on the PRSI and USC.

Im not in agreement with working off the books but it is hard to make a living as a child minder, even with covid rent needs to be paid.

Id say she is not alone and there are quite a number in her situation.

Chiorino

Joe Exotic wrote: »

Id reckon she would owe a tiny amount on the PRSI and USC.

It's the interest and penalties that Revenue apply that are the killer.

Joe Exotic

Chiorino wrote: »

It's the interest and penalties that Revenue apply that are the killer.

I hadnt anticipated that

JustAThought

Joe Exotic wrote: »

I know havent mentioned it to her yet (one worry at a time).

Id reckon she would owe a tiny amount on the PRSI and USC.

Im not in agreement with working off the books but it is hard to make a living as a child minder, even with covid rent needs to be paid.

Id say she is not alone and there are quite a number in her situation.

I doubt that they were conniving enough to claim the covid payments. I’d say she will be in a lode of problems with revenue -from the start covid payments announced they would be sharing details with social welfare and revenue to give people advance warning of what would be coming down the road at them. They have caught 35,000 tax cheats already. Lets hope her tax credits are not shared with a partner and she isnt availing of any state benefits like schools meals/laptops/uniforms/adult courses/rent allowance etc as they will all be repayable to the taxpayer who foots them - note - the people who work legally and pay the tax due on what they earn - not the ones who earn and may claim benefits and cheat the system and others working by not declaring it. Where does she think the taxes to pay for the covid payment come from?
There may also be the standard cash penalties on undeclared earnings and outstanding taxes due as well as repaying the covid 19 payments already made in addition to penalties for working illegally without paying taxes /UsC/PRSI due.

Wanderer78

JustAThought wrote:

I doubt that they were conniving enough to claim the covid payments. I’d say she will be in a lode of problems with revenue - covid payments announced they would be sharing details with social welfare and revenue to give people advance warning of what is coming down the road at them. Lets hope her tax credits are not shared and she isnt availing of ang state benefits like schools meals/laptops/uniforms/adult courses/rent allowance etc as they will all be repayable to the taxpayer who foots them - note - the people who work legally and pay tax due on what they earn - not the ones who claim benefits and earn but cheat the system and others working by not declaring it. Where does she think the taxes to pay for the covid payment come from? There may also be the standard cash penalties on undeclared earnings and outstanding taxes due.

Government borrowed the money for covid payments

JustAThought

Wanderer78 wrote: »

Government borrowed the money for covid payments

And the borrowing fairy pays it back? No - its from taxes earned and paid into the government coffers - by people who work and pay their way and pay their taxes and are honest.

nibtrix

It's hard to see how anyone working illegally/unregistered for tax could believe they were entitled to the PUP.

With regard to retrospectively applying for unemployment for the period, it would be subject to the usual requirements i.e. Be unemployed, Be capable of work, Be available for full-time work and genuinely seeking work, Satisfy the means test & Meet the habitual residence condition.

If I was processing the claim, I would ask how they were suddenly available/seeking work at this time, when they weren't before.

Joe Exotic

JustAThought wrote: »

I doubt that they were conniving enough to claim the covid payments. I’d say she will be in a lode of problems with revenue -from the start covid payments announced they would be sharing details with social welfare and revenue to give people advance warning of what would be coming down the road at them. They have caught 35,000 tax cheats already. Lets hope her tax credits are not shared with a partner and she isnt availing of any state benefits like schools meals/laptops/uniforms/adult courses/rent allowance etc as they will all be repayable to the taxpayer who foots them - note - the people who work legally and pay the tax due on what they earn - not the ones who earn and may claim benefits and cheat the system and others working by not declaring it. Where does she think the taxes to pay for the covid payment come from?
There may also be the standard cash penalties on undeclared earnings and outstanding taxes due as well as repaying the covid 19 payments already made in addition to penalties for working illegally without paying taxes /UsC/PRSI due.

Shes single and in fairness to her she isnt claiming anything, I genuinely think she just didnt think about it and applied in good faith, she needed some way to pay the rent.

Again i dont agree with with working off the books myself for the very reason its my taxes funding all this.

StupidLikeAFox

Did she operate in her own home or in the childs home? Maybe the parents should have registered as employers. Either way the Revenue is going to take a dim view of the entire situation. There are tax reliefs available for childminding but you still need to be registered and declaring income to claim it back.

Joe Exotic

StupidLikeAFox wrote: »

Did she operate in her own home or in the childs home? Maybe the parents should have registered as employers. Either way the Revenue is going to take a dim view of the entire situation. There are tax reliefs available for childminding but you still need to be registered and declaring income to claim it back.

Operated in their home

TheBeach

If she operated in their home the onus is on them to pay prsi for her and put on a stamp /contribution. Maybe they could retrospectively do that and then she might be entitled to the pup. She definately should ask them to do it going forward as that contribution insures her against this sort of thing and illness benefit, maternity and jobseekers.

whippet

TheBeach wrote: »

If she operated in their home the onus is on them to pay prsi for her and put on a stamp /contribution. Maybe they could retrospectively do that and then she might be entitled to the pup. She definately should ask them to do it going forward as that contribution insures her against this sort of thing and illness benefit, maternity and jobseekers.

that won't happen - it would probably double the cost of the childcare and negate the reason for having a cash-in-hand childminder


I'm sure there are plenty of cash-in-hand workers all over the country in the same bind.

The cash economy is grand until you need to legitimise and realise that you can't. I know of a few heads working on doors and in kitchens who were only delighted to work cash in hand and claim social welfare and then cried fowl when they lost their jobs back in march as they had lifestyle expenses that they couldn't maintain purely on social welfare.

Wanderer78

JustAThought wrote: »

And the borrowing fairy pays it back? No - its from taxes earned and paid into the government coffers - by people who work and pay their way and pay their taxes and are honest.

again, no its not, the government borrowed the money at record low rates, in some cases negative rates, if they were sensible, theyd push these loans out over a very long period, and not need to raise taxes in order to service these debts, but since our government is obsessed with more conservative economic practices, they ll try balance the books soon, forcing them to raise taxes in order to service these debts, when in fact there would be no need to if they just pushed these debts out into the future, and encourage the economy to grow its way out.

antimatterx

Wanderer78 wrote: »

again, no its not, the government borrowed the money at record low rates, in some cases negative rates, if they were sensible, theyd push these loans out over a very long period, and not need to raise taxes in order to service these debts, but since our government is obsessed with more conservative economic practices, they ll try balance the books soon, forcing them to raise taxes in order to service these debts, when in fact there would be no need to if they just pushed these debts out into the future, and encourage the economy to grow its way out.

Low rates or not, the principal still needs to be paid back. I didn't stop working during COVID, why should my tax money service that debt.

Wanderer78

antimatterx wrote: »

Low rates or not, the principal still needs to be paid back. I didn't stop working during COVID, why should my tax money service that debt.

the majority of course needs to be paid back, obviously those loans with positive rates do need to be, but not all needs to be paid back with negative rates. you could contact your local politicians and ask them not to use your tax payments to service our national debt, i dont think you ll be successful, but i guess it ll give you the feeling of doing something about it. you could also refuse to pay taxes, like the ops friend, and see what happens, that probably wont work out too well either

C3PO

Joe Exotic wrote: »

Shes single and in fairness to her she isnt claiming anything, I genuinely think she just didnt think about it and applied in good faith, she needed some way to pay the rent.

Again i dont agree with with working off the books myself for the very reason its my taxes funding all this.

It’s hard to believe that anyone wouldn’t have seen where this would end up! What did she think was going to happen?

fineso.mom

Bit late now, but why didn't she just apply for job seekers or whatever the normal payment is?

Sleeper12

Joe Exotic wrote:

Id reckon she would owe a tiny amount on the PRSI and USC.

Plus fines, penalties and interest.

Joe Exotic

C3PO wrote: »

It’s hard to believe that anyone wouldn’t have seen where this would end up! What did she think was going to happen?

Didnt think i suppose, Just assumed that it was for everyone and didnt question the condidtions.

Joe Exotic

Sleeper12 wrote: »

Plus fines, penalties and interest.

Anyone any idea what these are made up of ?
I looked for a table but couldnt find anythin on revenue

Just the warning that you might get them, am going to advise her to "regularise" her position with revenue as they suggest on the Site.

whippet

Joe Exotic wrote: »

Anyone any idea what these are made up of ?
I looked for a table but couldnt find anythin on revenue

Just the warning that you might get them, am going to advise her to "regularise" her position with revenue as they suggest on the Site.

it's hard to know without knowing her liability.

I've seen Interest and penalties bringing the actual liability to double if not more. Its designed to be punitive to discourage people from evading tax.

I got caught out stupidly a few years back - I made a silly assumption and got a lovely letter telling me that I owed €7k the first week in January with a demand for payment within 28 days or else interest and penalties will be applied.

I called revenue and said I would pay but couldn't fork out the full amount initially - so made a lump sum payment and paid the rest over 6 months and no interest or penalties were applied. Generally if you engage with revenue and stick to your agreed payback they won't lump on the interest and penalties.

But reneged and you'll know all about it

Joe Exotic

whippet wrote: »

it's hard to know without knowing her liability.

I've seen Interest and penalties bringing the actual liability to double if not more. Its designed to be punitive to discourage people from evading tax.

I got caught out stupidly a few years back - I made a silly assumption and got a lovely letter telling me that I owed €7k the first week in January with a demand for payment within 28 days or else interest and penalties will be applied.

I called revenue and said I would pay but couldn't fork out the full amount initially - so made a lump sum payment and paid the rest over 6 months and no interest or penalties were applied. Generally if you engage with revenue and stick to your agreed payback they won't lump on the interest and penalties.

But reneged and you'll know all about it

Was working in creche till late last year then paid part time since then, not sure what it was but just enough to make it better than or similar to Dole (Which she didnt collect)

THats why i think its small enough, but as people said above its still not right no matter how small it is.

StupidLikeAFox

If she only became self employed at the end of last year then her first return won't be due until this October. It might even be October 2021 actually as I think they let you skip your first year in business. If that is the case she probably hasn't missed any deadlines so far and might be in the clear (although she should still register herself asap)

JosTep

A childminder can earn up to €15,000 without the imposition of Income Tax if they provide the service in their own home and care for no more than 3 children (other than their own). This exemption does not extend to USC or PRSI. Even if the individual is under the threshold, they are obliged to report it to revenue on a Form 11 (they must be registered as self employed)

There is a minimum PRSI payment if the income is over €5,000 and that is €500 - interest is applicable but penalties generally only apply if the tax liability is over €6,000

As for the pandemic payment - if their is no record of income then it is difficult to argue the case of entitlement - but that is a Department of Employment Affair and Social Protection

Sleeper12

Sleeper12 wrote: »

Plus fines, penalties and interest.

And the possibility of her name being published.

JosTep

Deleted User wrote: »

And the possibility of her name being published.

Only if the Tax Interest & Penalty is over €35,000

dartboardio

Bit her in the arse so.. Always does..

Working cash in hand, not declaring your income to social welfare then expecting an unemployed payment when things go haywire..

Thats the crap about working cash in hand and Id say she learned her lesson now unfortunately!

I worked in a cash in hand place when I was younger, then was sickened when I left after 2 years and wasn't due a penny holiday pay because I hadn't legally been working there anyway :V

FutureTeashock

The banks were bailed out with 10s of billions of public funds, the richest corporations in the world receive state aid and the govt. pays their legal costs, and yet not a whimper from those in the thread who are calling for a low paid employee to be raked over the coals by revenue.


It's a horrible "society" to be a part of, and now there is nowhere to emigrate to.:(

Bubbaclaus

FutureTeashock wrote: »

The banks were bailed out with 10s of billions of public funds, the richest corporations in the world receive state aid and the govt. pays their legal costs, and yet not a whimper from those in the thread who are calling for a low paid employee to be raked over the coals by revenue.


It's a horrible "society" to be a part of, and now there is nowhere to emigrate to.:(

What exactly does any of that have to do with this thread?

Ninthlife

Joe Exotic wrote: »

Anyone any idea what these are made up of ?
I looked for a table but couldnt find anythin on revenue

Just the warning that you might get them, am going to advise her to "regularise" her position with revenue as they suggest on the Site.

Penalty can be up to 100% of the liability depending on a number of factors.

Her cooperation with any investigation will be taken into account. And interest is 0.0274% per day on the liability. They can apply this going back to when the payments firsr started so if she is doing it years this can clock up a fair amount

StackSteevens

FutureTeashock wrote: »

The banks were bailed out with 10s of billions of public funds, the richest corporations in the world receive state aid and the govt. pays their legal costs, and yet not a whimper from those in the thread who are calling for a low paid employee to be raked over the coals by revenue.

Quality whataboutery - although to be fair to you, you didn't mention the bad weather nor the shocking price of a mug of latte in Starbucks!

FutureTeashock

StackSteevens wrote: »

Quality whataboutery - although to be fair to you, you didn't mention the bad weather nor the shocking price of a mug of latte in Starbucks!

The next time some ***** grumbles about long term dole scroungers, I will direct them to this thread.


It simply doesn't pay to work if your income falls below a certain level in this cuntry.

StackSteevens

Joe Exotic wrote: »

Was working in creche till late last year then paid part time since then, not sure what it was but just enough to make it better than or similar to Dole (Which she didnt collect)

THats why i think its small enough, but as people said above its still not right no matter how small it is.

It is small enough, and she hasn't got very much to worry about regarding Revenue. If she decides to declare herself as self-employed then she has until October 2021 to file her Form 11 for this year.

For last year she should file a Form 12 that includes her cash in hand earnings.

Personally I'd be far more concerned about what Social welfare will do about the fraudulent application for a Covid 19 payment for which it would appear she wasn't entitled.

StackSteevens

FutureTeashock wrote: »

The next time some ***** grumbles about long term dole scroungers, I will direct them to this thread.


It simply doesn't pay to work if your income falls below a certain level in this cuntry.

I defer to your in-depth knowledge of Ireland's Social Welfare system.

jrosen

Revenue generally are happy to work out a payment plan.

Childminders are allowed earn a certain amount and not pay tax but they still have to register. Im not sure how it works for your friend though. She would be classed as an employee seeing as she worked in the families home and they are liable for paying her stamps.
Her best bet is to engage with revenue and be honest

FutureTeashock

FutureTeashock wrote: »

The next time some ***** grumbles about long term dole scroungers, I will direct them to this thread.


It simply doesn't pay to work if your income falls below a certain level in this cuntry.

This thread isn’t about a dole scrounger, rather a young lady who foolishly didn’t declare her income from self employment to Revenue.

If one cannot live on the salary they earn, then it’s up to them to get a better paying position.

FutureTeashock

Deleted User wrote: »

This thread isn’t about a dole scrounger, rather a young lady who foolishly didn’t declare her income from self employment to Revenue.

If one cannot live on the salary they earn, then it’s up to them to get a better paying position.

OR, they can stay on the dole long term, much to the chagrin of people such as yourself.