Taxi Accounts Obligations

[smithy]

My husband recently left his job to become a taxi driver. He took out loan to finanace buying the car and all other expenses related to strating up. I have some accounts experience and hope to be able to do this end of things for him as there really isn't enough income to use an account. I believe taxi drivers can't register for VAT (????) Any helpful tips on what accounts need to be completed would be gratefully appreciated. He recently recieved a "Self Assesment" form from the tax office & I am completely lost on how to complete it.

Thanks!!!!

 

[Joe1234]

there really isn't enough income to use an account............. "Self Assesment" form from the tax office & I am completely lost on how to complete it.

You do need an accountant, regardless of how little income there is, particularly if you cannot complete the self assessment form.

 

[smithy]

You do need an accountant, regardless of how little income there is, particularly if you cannot complete the self assessment form.

Thank you for your most useful, informative & helpful response.

 

[Glenbhoy]

Smithy, what did he do prior to taxi driving? I would have thought that he'd would'nt have to complete any tax returns until November 2008 (if he started up this year) due to the start up rules.
The most basic thing you need is an income and expenditure account. At this stage you should do the following. Keep a record of his daily takings, and his expenditures (whether deductible or not, that can be decided later). I would also recommend that you get an accountant to complete the accounts and fill in the form 11, if you have done a good job with the cash books, (s)he may be reasonably cheap (particularly if (s)he's doing it as a nixer, you should be able to find a trainee accountant who works in the correct practice environment).

 

[levelpar]

Hi Smithy, I worked a taxi for 15 years and from my experience I would advise your husband use the facilities of whatever taxi union he joins as they have all the experience. In my time Tommy Gorman of the National Taxi Drivers Association used to do the tax returns for the drivers. They used to be in Camden St area at the time.

 

[ubiquitous]

he may be reasonably cheap (particularly if (s)he's doing it as a nixer, you should be able to find a trainee accountant who works in the correct practice environment).

Pay peanuts and you get a ....

Also, bear in mind that Revenue will not communicate with, or accept returns from, a third-party acting on your behalf unless they have a TAIN (tax agent) designation from the Revenue. Very few (if any) trainee accountants working in practice will hold this designation as trainees are usually banned from undertaking nixer work, as a condition of their training contacts. If a trainee was found by their employer to hold TAIN designation in their own right, they would be at risk of instant dismissal.

 

[Glenbhoy]

Ubi, just trying to suggest a cost effective way of retaining compliance in this start up situation. The advice required here should be relatively simple for a part-qualified working in a small practice where part of his/her remit included self-assessment. There is no requirement for this person to have TAIN etc, and in a job this size very few firms would be interested in it, often an employer would point someone wanting this this type of job in the direction of one of their more senior trainees.
As for the threat of instant dismissal, given the dearth of trainees at this stage, I doubt it somehow!
You are of course correct in that you get what you pay for and whilst the solution I've suggested may work short term, it's no substitute for good professional advice.

 

[ubiquitous]

There is no requirement for this person to have TAIN etc,.

I'm surprised that you say this, given that Revenue will not entertain phone calls, letters or other communications from agents unless the agent has a TAIN. In such a scenario, even a simple matter like getting a tax clearance cert or having an error removed from a tax assessment (which certainly will be necessary at some stage under the paper-based tax return process, as online filing is difficult to impossible without a TAIN) becomes a problematic chore for both the client and the agent.

and in a job this size very few firms would be interested in it,.

I don't know where you work but the vast majority of accountancy firms in this country are small firms specialising in sole traders and small companies. I doubt if many would turn down work like this.

often an employer would point someone wanting this this type of job in the direction of one of their more senior trainees.

I have never seen this in almost 20 years working.

As for the threat of instant dismissal, given the dearth of trainees at this stage, I doubt it somehow!.

This is a matter of subjectivity but in general I don't think that trainees are wise to wilfully break the terms and conditions of their training contracts. The consequences can go further than being an issues solely between the trainee and their firm. The ICAI for example (at least officially) take a dim view of trainees and other unqualifieds doing accounting work for the public on their own account. In the event of a complaint to an Institute about "nixer"work done by a person who happens to be a trainee under that Institute's system, the trainee might find the Institute a far tougher adversary than their employer.

 

[smithy]

Smithy, what did he do prior to taxi driving? I would have thought that he'd would'nt have to complete any tax returns until November 2008 (if he started up this year) due to the start up rules.
The most basic thing you need is an income and expenditure account. At this stage you should do the following. Keep a record of his daily takings, and his expenditures (whether deductible or not, that can be decided later). I would also recommend that you get an accountant to complete the accounts and fill in the form 11, if you have done a good job with the cash books, (s)he may be reasonably cheap (particularly if (s)he's doing it as a nixer, you should be able to find a trainee accountant who works in the correct practice environment).

Glen, thanks a million. I have kepy a basic record on income & expenditure. On the expensed side, I've broken down the vatable figures (still not sure if that's applicable) My husband fully intends to get an accountant eventually, I have called a few accountants and they were asking for silly money to be honest. He has only been at this since December and between buying the car and all the expenses, he literally has a week's wages out of it. So I figured after 12 months, then it would be wise to hand all the crap over to the accountant. I just couldn't see any of the ones I called being too impressed with writing up petrol & car wash receipts!!!

Up until the time he started in the taxi, he had worked for a company for 6 years. The tax return all came about when I submitted our MED 1 & followed up a few weeks later to see how the claim was proceeding. One of our children has a medical problem and as we are not entitled to a medical card, I am always fairly prompt on completing the MED 1. WHen I called, they said it could not be processed as my husband was on the self assessment basis...... the self assessment form hasn't been looked at since!! It's the stuff that nightmares are made of!

Thanks again Glen

 

[smithy]

Hi Smithy, I worked a taxi for 15 years and from my experience I would advise your husband use the facilities of whatever taxi union he joins as they have all the experience. In my time Tommy Gorman of the National Taxi Drivers Association used to do the tax returns for the drivers. They used to be in Camden St area at the time.

Thanks for that Fran, he hasn't joined one yet. But on the basis of what you've said.... it's about time he did!!! Off this issue.... how did you benefit from being in the union for all that time?

 

[levelpar]

Hi Smithy, When I started the taxi business, I engaged an accountant to do my returns. I saw him once a year and he usually asked me for a return of income assuming I kept records . As a previous paye ,I had'nt a clue about keeping records and as it was a boring and tiresome thing to do following a nights work, I never seem to get around to it ,so usually made up a figure to keep him happy at the end of the year. BAD MISTAKE. To cut a long story short, I ended up in trouble with the revenue. My acccountant took fright and ditched me after sending me a big bill . My experience over the years is that accountants are great for sending big bills but dont really understand the taxi business. After the accountant ,I turned to the taxi union who helped me sort out my problems without charging per hour. Look!.take my advice ,join a union and get them to do the tax . However, it up to you

 

[DonKing]

Smithy,

You should really get an accountant with experience in the taxi business.

Most Taxi drivers virtually pay no tax compared to PAYE. There are plenty of taxi drivers out there taking in 60k plus and paying a small fraction in tax. It pisses me off really being PAYE, but thats the way it is.