Member Article

SMEs dodge taxman with cash in hand payments

New research has shown that increasing numbers of small businesses are dodging the taxman by charging customers in cash.

It is estimated that up to 10% of all companies could be taking cash payments to hide their full earnings from HM Revenue and Customs, and while there is no law against receiving cash, there is onus on businesses to correctly declare their full earnings.

Experts believe that up to £50 million could be being hidden by plumbers, electricians, window cleaners and gardeners. This trend has been attributed to the rise in entrepreneurs who have started up their own businesses in the wake of the recession.

However, an expert believes that this trend will continue to flourish, as they are beneficial to everyone- except the Inland Revenue

She said: “They present the trader with a lower tax bill, and also drive down cost. From our research, we believe cash-only payments are on the increase.

“Obviously, all consumers should strive to stick to the law, but it would take a consumer made of granite to argue with anyone who offers a job at a discount.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .