Paying 16yr old Son for ad-hoc help

[NFSH_79]

Morning Peeps

Sole trader working by myself but occasionally my Son has helped with 'menial tasks' e.g. sorting my stock, etc. Nothing too crazy for his age! (recently turned 16) has literally is the odd half hour/hour here and there.

I always have said that I'd pay him for his time but in all honesty I never have! He's now at college and for any help now I really should reward him financially, he let me know this quite often nowadays!

The work time that he would do for me going forward in all honesty would still just be few hours here and there as required and suitable to age etc - thinking £5.00-6.00/hr is fair?

This is no tax avoidance scheme - i.e. employing stay at home wife on £10k a year ? blah blah - simply reward for time worked.

So if I keep simple record of time worked would that suffice? can I pay him out of the cash I get from sales? this would obv. all be accounted for in my books. and presuming as this is pretty minimal in terms of 'employment' no need for getting PAYE etc involved?

Cheers muchly, N

 

[MyAccountantOnline]

Morning Peeps

Sole trader working by myself but occasionally my Son has helped with 'menial tasks' e.g. sorting my stock, etc. Nothing too crazy for his age! (recently turned 16) has literally is the odd half hour/hour here and there.

I always have said that I'd pay him for his time but in all honesty I never have! He's now at college and for any help now I really should reward him financially, he let me know this quite often nowadays!

The work time that he would do for me going forward in all honesty would still just be few hours here and there as required and suitable to age etc - thinking £5.00-6.00/hr is fair?

This is no tax avoidance scheme - i.e. employing stay at home wife on £10k a year ? blah blah - simply reward for time worked.

So if I keep simple record of time worked would that suffice? can I pay him out of the cash I get from sales? this would obv. all be accounted for in my books. and presuming as this is pretty minimal in terms of 'employment' no need for getting PAYE etc involved?

Cheers muchly, N

Presumably you already operate payroll for your wife if so I'd simply add him as a second employee.

These links may help -

Child employment

Minimum working age and pay for children, how to apply for performance licences and what local council bylaws say about employing children, paying someone over 16

www.gov.uk

NMWM05160 - Entitlement to National Minimum Wage: family members - HMRC internal manual - GOV.UK

www.gov.uk

 

[DWS]

Presumably you already operate payroll for your wife if so I'd simply add him as a second

OP says working by themselves, I thought they just mentioned the wife as something others do to avoid tax, if so no need to set up Payroll just for the son.
But age and NMW do need to be considered.

 

[MyAccountantOnline]

OP says working by themselves, I thought they just mentioned the wife as something others do to avoid tax, if so no need to set up Payroll just for the son.
But age and NMW do need to be considered.

Thanks DWS just re-read it and I think you are right.

 

[Newchodge]

£5.28/hour is the NMW.

 

[NFSH_79]

Presumably you already operate payroll for your wife if so I'd simply add him as a second employee.

Sorry, that's my waffling.

I have no Payroll, my wife is full time employed PAYE, no involvement in business.

I was referring to fictitious roles for family members to reduce taxes etc. I found a similar thread to my question but it had exploded into paying children, siblings, spouses inflated wages for non existent roles leading to HMRC red bells and whistles - was trying to avoid it heading in that direction.

Simply wanted to know for the few hours he might work on occasion that the paying in cash, from Sales, at a fair rate was okay with no need for payroll. I cannot see it amounting to much but a few hundred pounds.

Many thanks, N

 

[Newchodge]

Sorry, that's my waffling.

I have no Payroll, my wife is full time employed PAYE, no involvement in business.

I was referring to fictitious roles for family members to reduce taxes etc. I found a similar thread to my question but it had exploded into paying children, siblings, spouses inflated wages for non existent roles leading to HMRC red bells and whistles - was trying to avoid it heading in that direction.

Simply wanted to know for the few hours he might work on occasion that the paying in cash, from Sales, at a fair rate was okay with no need for payroll. I cannot see it amounting to much but a few hundred pounds.

Many thanks, N

You only need to run payroll for him (unless you already run it for someone else) if he earns £123 per week. Which seems unlikely!

 

[NFSH_79]

You only need to run payroll for him (unless you already run it for someone else) if he earns £123 per week. Which seems unlikely!

?Defo less than that per week, I need to earn something first ?

 

[neilsolaris]

If he was considered to be helping you out on a self-employed basis, would I be correct in saying the NMW doesn't apply?

And if his self-employed income is less than £1000 for the tax year, then no need to register as self-employed.

 

[Newchodge]

If he was considered to be helping you out on a self-employed basis, would I be correct in saying the NMW doesn't apply?

And if his self-employed income is less than £1000 for the tax year, then no need to register as self-employed.

How can a 16 year old helping his father out on an ad hoc basis possibly be doing it as self employed? Will he choose how he carries out the work, will he work unsupervised, can he send someone else in his place?

How can you think of teaching a 16 year old that the law is an irrelevance and can be broken with impunity.

 

[neilsolaris]

How can a 16 year old helping his father out on an ad hoc basis possibly be doing it as self employed? Will he choose how he carries out the work, will he work unsupervised, can he send someone else in his place?

How can you think of teaching a 16 year old that the law is an irrelevance and can be broken with impunity.

Good point!

 

[fisicx]

Or just pay them cash out your pocket. No need to tell anyone anything.

 

[DWS]

Or just pay them cash out your pocket. No need to tell anyone anything.

But then you lose being able to claim the cost as an expense in the accounts

 

[Newchodge]

Or just pay them cash out your pocket. No need to tell anyone anything.

There is a need to tell HMRC they have been paid, so that the business can claim the allowable expense. HMRC are not interested in the earnings as far as the son is concerned.

 

[NFSH_79]

There is a need to tell HMRC they have been paid, so that the business can claim the allowable expense. HMRC are not interested in the earnings as far as the son is concerned.

Thank you, appreciated. Can I cheekily ask best way of categorising the expense in accounts? I use QBO if that helps?!?
I did have a search after clarification of all being good but results all coming back as if Payroll is being used

Cheers again N

 

[DoolallyTap]

You say - referring to fictitious roles for family members to reduce taxes
So what you really want to do is cheat the taxman, good luck.
Put him on the books properly and then pay minimum wage, or just pay out of pocket.

 

[Newchodge]

You say - referring to fictitious roles for family members to reduce taxes
So what you really want to do is cheat the taxman, good luck.
Put him on the books properly and then pay minimum wage, or just pay out of pocket.

This is rubbish. The intention is to put him on the books. But there is no requirement to run payroll.