Tenant claims they earn more then stated on payslip

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    Tenant claims they earn more then stated on payslip

    I have shown the property to prospective tenants.

    On two of the viewings, I was told by tenants have payslips. However, their payslip has a lower salary then they actually earn. They said their company does this to save tax. One of them claimed their payslip says £900, but they earn £2,000 per month. The remaining been paid in cash. I explained it makes referencing hard for me.

    The tenants seem plausible enough.

    What are peoples thoughts?

    #2
    Originally posted by Flashback1966 View Post

    What are peoples thoughts?
    The property you thought would be home to two will actually be home to five.

    Comment


      #3
      Ask for a bank statement? Or maybe they stuff all the extra cash into the mattress each month.

      Comment


        #4
        I also fail to see how any company can save tax by claiming to pay employees less than they actually do? Surely that would cost them more?

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          #5
          You have to go by what people can prove.

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            #6
            "I also fail to see how any company can save tax by claiming to pay employees less than they actually do? Surely that would cost them more?"
            The company saves national insurance contribution. If many of their customers pay in cash, they declare less income, so pay less tax.

            Comment


              #7
              Originally posted by Flashback1966 View Post
              The tenants seem plausible enough.
              Yes. That's the skill of confidence people (con men)... they are plausible. I would be explaining that you'll wait for the next Tenants to come along.

              Comment


                #8
                Tell them the paper-recorded rent will be £xxxx but you actually require 2x£xxxxx to save tax...

                Sigh!! Never do business with cheats or crooks: Find other tenants. (Unless last 3 months bank statements show good numbers..)


                Me, I'd report the company & people to HMRC for being on the fiddle: We don't want tax cheats here - any more than we want benefit cheats....
                I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

                Comment


                  #9
                  Originally posted by Flashback1966 View Post
                  On two of the viewings, I was told by tenants have payslips. However, their payslip has a lower salary then they actually earn. They said their company does this to save tax. One of them claimed their payslip says £900, but they earn £2,000 per month. The remaining been paid in cash. I explained it makes referencing hard for me.
                  I've had the same situation myself. I ended up contacting the employer direct (having taken steps to verify he was who he said he was!) and he confirmed the story. Though it struck me at the time that any employer who was unethical enough to pay his employers in this way would also be exactly the same sort who would lie to a landlord about the applicant's income, if the applicant asked him to!

                  In the end I did take the applicant on, but only because he had a partner/joint applicant who was earning well, and even assessing them on the lower, proven total income they were pretty close to my stipulated income threshold. I never got any comeback from that!

                  Comment


                    #10
                    Originally posted by Flashback1966 View Post
                    I have shown the property to prospective tenants.

                    On two of the viewings, I was told by tenants have payslips. However, their payslip has a lower salary then they actually earn. They said their company does this to save tax. One of them claimed their payslip says £900, but they earn £2,000 per month. The remaining been paid in cash. I explained it makes referencing hard for me.

                    The tenants seem plausible enough.

                    What are peoples thoughts?
                    Not acceptable to me. Have you seen bank statements? If so, does it show regular rent payments to current landlord? Does it also show regular payments of Housing Benefit?

                    Comment


                      #11
                      The higher incomes will be shown on their SA Tax Returns - the company can avoid the tax and NI but the "employees" can't.

                      What type of trade were the individuals in - lots of builders work like this, but few banks?

                      Assuming they're just not lying, obviously.
                      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                      Comment


                        #12
                        Originally posted by jpkeates View Post
                        The higher incomes will be shown on their SA Tax Returns - the company can avoid the tax and NI but the "employees" can't.
                        Er... if the employees do indeed fill in a Tax Return (doubtful, as most low-paid workers who just get paid PAYE do not do so) then they surely will just fill in the amount written on their payslip. Regardless of the moral issues of doing this (and saving themselves income tax), they will know that otherwise they would be dobbing in their employer to HMRC and would undoubtedly lose their job...

                        Comment


                          #13
                          Originally posted by jpkeates View Post
                          Assuming they're just not lying, obviously.
                          You missed this bit out.

                          Their contention is that the company is giving one of them a pay slip with £900 a month on it and paying them another £1100 a month.
                          It's possible (working for two different companies with one a more - cough - formal structure and the other more cash based happens in some trades) but fairly unlikely.

                          However, if they want to pass a credit check, their income has to be recorded somewhere (bank statements only help if the money goes into a bank).
                          This was the only way I imagine they could "prove" their income is what they say it is.

                          I am astonished you would think that honest prospective tenants might fall behind in their civic duty as tax payers or lie to a landlord.
                          8-)
                          When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                          Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                          Comment


                            #14
                            Originally posted by Claymore View Post
                            Not acceptable to me. Have you seen bank statements? If so, does it show regular rent payments to current landlord? Does it also show regular payments of Housing Benefit?
                            Yes, of course, I didn't think about benefits. They'll be 'entitled' to top ups as they are on low wages. Find someone honest to rent to.

                            Comment


                              #15
                              Originally posted by theartfullodger View Post
                              Tell them the paper-recorded rent will be £xxxx but you actually require 2x£xxxxx to save tax...

                              Sigh!! Never do business with cheats or crooks: Find other tenants. (Unless last 3 months bank statements show good numbers..)


                              Me, I'd report the company & people to HMRC for being on the fiddle: We don't want tax cheats here - any more than we want benefit cheats....
                              Indeed.

                              I once asked a garage friend, what discount he'd give me for cash. His words "FFS, I have to put something through the books, or I'll have 'er majesties revenue and customs chasing me, but worse, I won't be able to prove my income, to the bank, when I want a business loan to expand"

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