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If one borrows money from a private person and repays them by working in their household - domestic cleaning, ironing, gardening, house sitting etc., does the money borrowed count as a loan or a wage?

Thanks.

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Since writing this post Anonymous may have helped people, but has not within the last four (4) days.
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money, loan, count, borrowed, wage
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If the money is coming in at regular intervals, it’s a wage. If it’s all up front, it’s a loan, but you pay it off with the wage you’re earning.

So wage either way, but depending on when you get the money determines if it’s a loan or not.

- just an opinion. Not verified or official information. 😅

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That depends on the agreement. If you agreed to work as repayment of a loan, it's a loan and the work is repayment. If you agreed to work in exchange for money, it's a wage.

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Anonymous
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Thank you. The money was given upfront. Who would be able to confirm if this is a loan or a wage - an accountant?

For example, my brother bought me a car and I repay him working in his business. However, he does not pay me and declares my earnings on his tax return. I suppose this would be a loan.

However, my friend wants to give me money in exchange for house work. I am not sure of this one.

Helpcomanimatedyetiwithdot256
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Mayhap it could be filed as a gift. Probably ought to ask a local accountant or tax attorney - one versed with the details and conditions of the process.

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[quote]Test.[/quote]

Anonymous
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If you've borrowed money, that money is considered as loan.
There are any number of other ways to repay that loan. Pay back in full sum. Trade. In this case, you have agreed to work for that person by providing home services, to pay him off, is the wage rate at which you agreed to pay back that loan.
There is no wage or salary in this case, as you aren't making anything, but paying off the loan.

However, he does not pay me and declares my earnings on his tax return. I suppose this would be a loan.

He wouldn't even do that. It would be a write-off for the value of the vehicle. If he declared your earnings he would be risking taxation for the amount he loaned you.

However, my friend wants to give me money in exchange for house work. I am not sure of this one

This IS wage-based income.

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This is a tricky question. If you wish it to be a wage taxes and fees are owed..
Why would you want it to be a wage? It sounds like a barter or gift exchange.

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soco
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Anonymous wrote:
Thank you. The money was given upfront. Who would be able to confirm if this is a loan or a wage - an accountant?

For example, my brother bought me a car and I repay him working in his business. However, he does not pay me and declares my earnings on his tax return. I suppose this would be a loan.

However, my friend wants to give me money in exchange for house work. I am not sure of this one.

If the payment is $130,000 and the money comes from someone who claims to be a lawyer, it's hush money.

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Anonymous
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(18 hours after post)
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Thank you, guys. Lol, no hush money! :D It would be only a few hundred pounds from my friend given to me beforehand. Then I would do the housework once a week until I would repay it at a set hourly rate.

And I don't want it to be a wage, but wants to ensure that I'm not doing anything illegal and pay taxes if I have to. I will be filling my tax return for last year soon, so want to know what to declare.

I will inquire with an accountant if it can be considered as a gift. Thanks again.

Sherlock by olga tereshenko d9qdidc
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I would call it repayment of a loan--because that is what it is. So there is no need to declare the repayment as income.

And it's not a gift if there are any "strings" attached, such as working in exchange for the loan.

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