Renting office space cash in hand

Faith

I’ve started a very small side hustle business, alongside full time PAYE employment. I would see clients as part of the work. A friend has a space that they have offered for my use as an office. It’s a perfect space, but it’s not zoned for commercial use so they want to make it a cash in hand agreement. Apart from the lack of security and inability to write the expense off against tax, is there any reason I couldn’t take this opportunity? I’m very naive to any laws etc about this kind of thing so appreciate any help. I do have public liability insurance already in place.

Gloomtastic!

Hello! 😋

Your friend’s offer is a great starting point but put a limit on how long you’ll be there. You may not be covered, insurance-wise, if you are on premises that are unsuitable. And it’s bad business practice to not claim all your expenses.

It may also be easier to move into a proper office if you can give a landlord’s reference

Moving offices is a pain, Changing all your printed marketing materials, informing clients and suppliers of the change. Don’t make a habit of it.

Good luck to you!

Count Dracula

You are allowed purchase anything you want, there is nothing unlawful about renting a property for cash.

It is also perfectly legitimate to claim it as an expense. Providing there are no VAT issues it looks straightforward.

To be honest with you, your biggest issue here is future access to your work environment based on what appears a verbal handshake? When you get into cosy relationships in business, they can often being a dreadful headache to unwind, for either hand in the agreement. " Eh listen Faith ....about that room / office / attic / caravan etc you have been using to hide all your crap in .... ?"

If you are starting up I would cut as many corners as you can, don't get bogged down in legal crap and tax and all the other dross. Worry about all that crap once your business is a viable going concern and you are making decent money. Get your business going first, much more important, learn from your mistakes, don't worry about them, you will and should be making loads of those.

Knuckle down and work the phuck out of it, enjoy and good luck!!!

Faith

Thanks a million for both your responses. I think a time-limited trial would be a great idea, both to establish viability of having office space and to get a sense of what I’ll need in the future. It’s a very fair point that things could get trickier down the line if the landlord wanted the space back etc.

My services would be more like consultation rather than anything that requires suppliers and much paperwork, so changing offices wouldn’t be an enormous problem. I’ll give it a shot for a few months and go from there so :)

downtheroad

https://www.boards.ie/discussion/comment/120445626#Comment_120445626

It's not legitimate to claim as a tax deductible expense if there's no receipt or invoice. Cash in hand arrangement 99% of the time means no receipt. No receipt, no deduction.

Count Dracula

https://www.boards.ie/discussion/comment/120448999#Comment_120448999

Won't stop me claiming?

Unless the lessor has specifically requested I don't .... or else.

If the rev got pernickety I would just show them the space rented as evidence?

Claim what you like, it is up to them to refuse your claim. As long as you are up to date and acting in good faith and true and fair, they shouldn't have any beef with it. We are not talking thousands here anyway - I am assuming?

All that lease malarkey only gets scrutinised if they have are going to give it to you hard, hard like publish your name in shame in the paper hard.... , hard like "how dare you try it on you naughty little non compliant liddle chanca ye?"....kinda take those 5-6 figures and pay us now citizen....kinda hard.

It costs them 1,500 a day to inspect your business. They only go sniffing around on tip offs. just make sure you don't piss anyone off who you don't trust.... basically everyone?

Do you think Rome, London or New York were built legitimately?

JP drove a JCB.

Gloomtastic!

I thought JP was a bookie. 🙄

Not sure how Revenue pick their victims but when they do get their claws on you they will check and cross check all the larger items of expenses - especially rent to make sure everyone is paying their due. Not being able to show a paper or digital trail for your rent would be a red flag as far as they are concerned. OP’s friend could be in trouble.

martingriff

https://www.boards.ie/discussion/comment/120450342#Comment_120450342

If you think revenue will just be happy with here look a space then you are severely deluded and maybe a nice penalty

Count Dracula

https://www.boards.ie/discussion/comment/120450461#Comment_120450461

really, have you any experience ?

kirving

https://www.boards.ie/discussion/comment/120450342#Comment_120450342

The issue here is that this is the OP's friend - who in turn is renting the space under the table.

https://www.boards.ie/discussion/comment/120450419#Comment_120450419

I have some passing knowledge of how they select business to be audited, quite a bit more scientific and data-driven than I would have imagined tbh.

Count Dracula

https://www.boards.ie/discussion/comment/120450419#Comment_120450419

in the city they really haven't a rats what is going on. most inspectors are in it for the glory and power down in country towns. they like the bit of infamy.

In Ashtown they are nobodies .... on a mission mind you , but kites in a whirlwind.

I will give you a laugh, how many Qualified Accountants are employed by the office of corporate enforcement ?

Have a guess?

Mick Tator

https://www.boards.ie/discussion/comment/120450631#Comment_120450631

Your comments on Revenue are daft. Also, there is no 'Office of Corporate Enforcement'. I assume you mean the Office of the Director of Corporate Enforcement (ODCE)? It no longer exists. It was replace a year ago by the Corporate Enforcement Authority. While you Google that you might also check out SEAR, which will be coming into law this year.

@Faith - I’d be a bit more severe than the Gloomster. Start as you mean to continue. Build a proper professional image. As he already pointed out, you will need business cards, headed paper with address, contact details, etc so why pay for all that if you could be moved tomorrow? Forget under the counter payments, you +friend will find yourselves in trouble with Rev. The premises sounds like a garage conversion, so if a nosey neighbour does not like the extra traffic/callers you will be out. I’d question the validity of your PL cover unless you have made full disclosure. Check your work contract to ensure your current PAYE employer allows a side-gig. Even if they are not expressly forbidden, should you be seen to be competing with your employer in any way you would be in trouble. Do it once, do it right; you want to focus on the business and not be looking over your shoulder all the time.

Count Dracula

how many Accountants has the director of corporate enforcement employed mick? come on, you know the story, have a guess?

Your Sentence structure is sublime btw Mick. You were in elocution lessons by 8.30 am , possibly twice a week?

Lord Tennyson, Emily Dickinson and WB Yeats , name the odd one out? Easy game Mick.

bucketybuck

https://www.boards.ie/discussion/2058291240/renting-office-space-cash-in-hand

Whatever you do, don't listen to the clown telling you to cut corners and stiff revenue based on the solid logic that "it'll be grand".

Faith

https://www.boards.ie/discussion/comment/120450749#Comment_120450749

Thanks, all good food for thought as well.

martingriff

https://www.boards.ie/discussion/comment/120450518#Comment_120450518

A here look is my space will go no where when asked for proof of rent and I am only talking about if they just decide to check a return. An audit of any size hope your books are in order. Only need to look at defaulter lists to see it.

I work in revenue and a section for refunds. Now while you may not be asked for evidence most of the time when asked only invoices were accepted

Count Dracula

https://www.boards.ie/discussion/comment/120451209#Comment_120451209

I hear it gets tight enough around mid summer, lads on breaks, large deposits in 6 month bonds, waiting for the preliminary.

Is there a statue of limitations in the carpark or boardroom?

My cousin used to to do PAYE in Nenagh, said it was mighty craic.

Isn't it gas that as soon as they swiped the property tax reliefs like 23 and rural 45 that the country stopped building? They were cursing Charlie McCreevy to Brussels , but he had the economy flying?

Del2005

https://www.boards.ie/discussion/comment/120448988#Comment_120448988

Who's public liability insurance will you be using? You may get away without a revenue audit but a slip/trip and you'll be in a world of pain without insurance.

martingriff

https://www.boards.ie/discussion/comment/120451402#Comment_120451402

WTF are you smoking

Count Dracula

https://www.boards.ie/discussion/comment/120451566#Comment_120451566

Mainly Vapes.

Different strokes Marty. That's the way the business rolls.

In fairness stale tobacco is bad for business. I tried to ban employees from smoking last year, there was uproar. I was only trying to stop the schtink of them. The 1980's was 40 years ago the way I see it.

It is so difficult formulating market strategy in these times? Every last pen pusher getting there 10 cents in everywhere and in the meantime the business is losing hand over fist. The computers are a waste of time and energy. People getting paid to sit around filing shight on a screen when they should be out there meeting new customers.

Winds me up no end.

Gloomtastic!

@Count Dracula you are starting to spout nonsense. Please don’t post here again.

The Gloomster!

Faith

I said I’d come back and update you all since you were so kind and helpful here. I went to look at my friend’s space properly last weekend. While it’s a lovely office, there were definite limitations given my line of work, including a couple that could cause trouble down the line (residents closer than I thought, with a shared entrance, etc).

It didn’t feel totally suitable, so I took a chance on checking out another space that I had previously dismissed. Turns out this other place is perfect, I can rent by the day rather than full time and it’s all above board, so no tax secrets and proper contracts for security (as well as the building being insured and used by lots of others in a similar line of work to me). Thanks again for all your advice, it was really useful to have in mind to view my friend’s space with a more analytical lens!

Mick Tator

https://www.boards.ie/discussion/comment/120481263#Comment_120481263

Sounds like the right decision. Best of luck with the project.