Urgent Query on self employed earning - ILR APPT next week

[ITGraduate]

Hi There,

sorry for the long history below but thought it was necessary.Apologies and thanks for reading.

My friend is employed ( part time job ) AND self employed working as an independent contractor for a US based company paying tax and NI in UK. He worked for them 4 months doing small projects and contract jobs for the company in US. He needs 20000 pounds to claim 15 points which is mandatory for him. He will be short by 200 pounds if the CW decided not to include one invoice for which he received pay from different bank account.

He invoiced them 4 times and he got paid 3 times from the company bank account and once from company secretaries personal bank account. ( the reason is company's bank account was changed from one bank to another ).

Please let me know the following as he is really stressed:

1- Is it possible that the caseworker may not accept the fourth payment as part of his earnings. ( Note: He invoiced same way to the company as normal but was paid in his uk bank account from secretaries account ) . He will not meet the required earnings if the CW doesn't accept his 4th invoice.

2- Even if the case worker doesn't include the fourth invoiced earning will they just remove the earning (OR) earnings + expenses. I mean his invoiced amount was 3200 pounds and his expenses was 300. so will they deduct 3500 ( earning + expenses ) OR 3200 ( only earnings ) from his total earnings claimed.

He has a letter from his accountant confirming all his 4 payments received, the accountant letter also says the expenses claimed.

Please help seniors with your advise

Thanks,

[muhammad.aftab]

Hi Mate..
answer to your question " if the CW decided not to include one invoice for which he received pay from different bank account."

Different bank accounts or different mode of payment doesn't matter as long as you accountant is aware and has mentioned in your accounts. As you have mentioned that you have invoiced them and they have paid into your UK account and accountant has taken this point in to your financial/unaudited accounts correctly it is fine. So according to what you have said I can't see any issue.

Where else the issue regarding the expense minus earning is bit different case worker will only be concerned with your net profit figure. As long as it hits the correct threshold you are OK.
Do let all know your PEO experience.

Also it will be more helpful if you could share your list of documents along with your route to ILR.

[ITGraduate]

Cheers mate for your response. I really appreciate and I will forward your advise to my friend. I'll also list his documents once they are ready.

I'll also await response from Seniors/Moderators to get some more idea

Thanks,

[ITGraduate]

Seniors/Experts please advise

Thanks,

[joh892]

I think what matters is whether your friend provided a service for which he is being paid. If he raised an invoice to the company and the company settled it by whatever means then I think the case worker has no reason to reject that payment. Remember your friend if he is registered for VAT he still has to account for the VAT to HMRC he charged the company for the services provided.

[ITGraduate]

Thanks for your advice mate

[muhammad.aftab]

No necessarily you have to be registered for VAT as from your given figure you have not hit the basic threshold required to be registered for VAT.
I think if the services or goods you'r selling more than £77000 then you should register yourself for VAT. Also there are some business, services and goods business that don't require VAT registration.

See these guidance note for more clarification.
VAT Guidance
http://www.hmrc.gov.uk/vat/start/regist ... ster.htm#1

Business to be and not to be registered for VAT
http://www.hmrc.gov.uk/vat/managing/rec ... mption.htm

[ITGraduate]

[quote="muhammad.aftab"]No necessarily you have to be registered for VAT as from your given figure you have not hit the basic threshold required to be registered for VAT.
I think if the services or goods you'r selling more than £77000 then you should register yourself for VAT. Also there are some business, services and goods business that don't require VAT registration.

See these guidance note for more clarification.
VAT Guidance
http://www.hmrc.gov.uk/vat/start/regist ... ster.htm#1

Business to be and not to be registered for VAT
http://www.hmrc.gov.uk/vat/managing/rec ... mption.htm[/quote]



Thank You mate for the details

Regards