If you are self employed and not paying your taxes how do you get found out?

Question

This is a hypothetical question, I pay my taxes.

Answer 1

well being self employed still means your required to inform the government of your income. however ppl dont do that and they way the government can find out is if your listed as an LLC and dont report, or when the bank releases its records to the feds and then the feds audit them they can find out. OR if someone who hires you finds out your not reporting and reports you... there are many many ways.

Answer 2

Even if you are self employed, there could be various paper trails originating from the payer, as they have to claim it as a business deduction.  That could lead into your receiving it.  Also, your bank deposits could be an indicator.  If nothing else, IRS could randomly pick you for audit./

Answer 3

There are lots of ways. Someone could report you, staff could see posters around or adverts in your local paper. Sometimes all business of one type in an area are targeted for investigation. Presumably you would do a tax return with false information. Taxmen are quite good at spotting odd trends on that. Bank information may not tie up with other things.

Also don't dismiss local knowledge. This depends on the type of area you are in.

Answer 4

By going on yahoo answers and telling everyone

Answer 5

Because your NI contributions stop, it flags up on the computer, just like your car tax does.

Answer 6

If you have paid National Insurance contributions, Income Tax or Local Government Tax or are currently listed in your local Electoral Register either in the past or currently they can find you. Its just a case of when! The HM Tax Inspectors have more powers to snoop through bank records or any other financial records than most other Government Agencies other than perhaps the Police - they can gain access to all your bank records, savings accounts without asking you if they need to. They find you out by checking if you've registered as employed and if so you should be paying NI and taxes or claiming tax relief. If you just disappear and do not respond to their letters you are flagged-up for potential investigation.