Had floors done in my house recently and think I'll be offered the option to pay cash or cheque. If I pay cash what sort of discount should I go for – 17.5%?- and is it worth it since normal receipts/ warranties may not apply. It's for 000s rather than 00s btw.
Cheers for any help given.

😆 Awaits the moral Police 😆

I always offer cash for discount. Most trades are open to a bit of cash work, just depends on how much they've all ready done and whether or not they need to put more through the books. I'd not normally expect the full 17.5% vat off. after all vat will still need to be paid on materials and the difference should probably be shared with the tradesman.

You've got tradesmen who offer warranties???

Its worth noting not all small tradesmen or business will be VAT-registered.

So its worth noting that you wont be 'dodging paying VAT'. Its upto the tradesman to self-declare etc his earnings. His business.

Warranty? You'd expect him to comeback and remedial anything.

I'd personally ask him to sign or provide a receipt for the work anyway. Therefore if the work is shoddy you can chase him legally (or threaten him with legal action)?

if the work is shoddy you can chase him legally

[/b]

My favourite armchair legal phrase ever.

It’s not your responsibility to make sure trader pays vat make the offer if they have not made it already.

I always take the line that if the work has been carried out as required, the folk doing the work are sound and friendly then I will (where possible) offer cash with the banter of discount – its then up to them if they decide to declare it or use it as holiday money 😆

I would expect to pay at least 20% less as they won't be paying VAT or tax on earnings.

Someone I know really well just had an extension done for £25k – it would have cost them £40k if it was through the books.

I would be looking for a 10 to 20% discount for paying cash, being a self employed tradesmen I would of course never accept, offer or suggest that this should be encouraged or that HMRC should be taken out of the loop!!! but I believe that it does occasionally happen.

If you could get the person to give you some sort of receipt or written acknowledgement then I think you would be very very lucky as this opens him wide open to be investigated and would probably lead to him being fined for thousands of pounds,as has happened to a number of people I know. However if the work has been good and the installer was recommended and you know their work at other places has been good then its probably worth the risk if you can get something decent off the price. Worst case scenario the money you get as a discount could always be used to pay someone else should there be a minor problem, like an insurance.

If the installers have provided the material they will already have paid for it and either paid the vat or will be added to their account if they have a trade account somewhere so the only vat saved will be on the labour. Assuming they are vat registered.

By them taking cash the only real benefit is for them to avoid paying tax on the income.

Cheers everyone 🙂

When i go into a bike shop and buy a bike or some large purchase i always ask for a discount or some freebies, and usually get it.

As for discounts for cash for work done, i nevber discount my work and always write out a receipt, even if the customer doesnt want one, offering a discount and then accepting cash belittles your work,also why dont you ask your boss to pay you cash, hethen doesnt jave to pay redundancy, sickness, or Ni , it could work well, and keep lot of companies in buisness.

Someone I know really well just had an extension done for £25k – it would have cost them £40k if it was through the books.

do the windows leak?

I would be wary of a trade person who was prepared to do a cash deal. Not being moral police, just think it makes it clear they are dishonest. Is that a good thing when you are spending 1000s ?

What hels said. Anybody dishonest enough to avoid VAT illegally is bot someone I'd trust to do anything significant to my house, they are quite prepared to cut corners if they think they can get away with it.

But from a purely risk based financial viewpoint I would bot expect a 15% discount if it is a cash job as they are taking more risk than you so would expect the greater share of reward.

tax evasion is illegl,tax avoidance isn't(thats how rich people get richer).there are many more good tradesmen out there than there are bad and recomendation of someone else is the best way to go.even more so if you can get to see work they've already done.and no matter what the deal the vat has to be paid on materials at source!

do the windows leak?

What windows? 😆

Nothing (morally or legally) wrong with either paying in cash or accepting cash.

And from the Tradesmans POV, at least he's been paid before he walks off the job, rather than 1/2/3 months later – and that in itself is worth a certain percentage.

just as an aside: just because you're paying in cash and getting a discount, doesn't necessarily mean the tradesman can't pay tax or something dodgy is going on. Cash might be preferable because it takes X weeks to get paid by credit card and a commission taken, it takes Y days for a cheque to clear and the bank might grab it to pay off an overdraft etc.

(but yeah usually it's to dodge tax)