FAO EricMC or anyone who can help with Tax
Discussion
I have just started up an ebay shop, selling crafts that I make myself, there is not a lot of money in it and for example if its costing me £1.00 (supplies, ebay fees) I am selling for £1.20, labour is not costed into it, but it does take a bit of time to make, and I should think traffic would be quite low- after all its just a hobby.
How would that affect any form of tax, what do I need 'declare' and what else do I need to consider?
Many thanks
How would that affect any form of tax, what do I need 'declare' and what else do I need to consider?
Many thanks
missdiane said:
I have just started up an ebay shop, selling crafts that I make myself, there is not a lot of money in it and for example if its costing me £1.00 (supplies, ebay fees) I am selling for £1.20, labour is not costed into it, but it does take a bit of time to make, and I should think traffic would be quite low- after all its just a hobby.
How would that affect any form of tax, what do I need 'declare' and what else do I need to consider?
Many thanks
How would that affect any form of tax, what do I need 'declare' and what else do I need to consider?
Many thanks
Eric Mc will no doubt be along, but you need to tell HMRC what you have earned and what expenses/costs you have incurred in doing that. You have to tell HMRC within 3 months that you are earning.
What you earn/get is set against expenses/costs incurred for tax purposes which might include your PC purchase and broadband connection (or a large proportion of it if used mainly for business), something for heat and light while you sit there 'making' stuff, any packing/postal charges (but what they Ebnay customers have paid would count as income too so any profit on psatge is profit for taxation). Don't forget mileage if you have to go to the post office/suppliers which is a 40p a mile cost for the first 10,000 miles.
You may even make a loss in these early days which I understand you can set off against other income sources that you do pay tax on.
What Leftie said (he's getting quite good at this).
If you initially are making losses at this (the sure sign that it's a hobby rather than a trade), the Revenue are quite happy for you to not bother letting them know. Obviously, once you are making profits, they will get very annoyed if you don't tell them.
If you initially are making losses at this (the sure sign that it's a hobby rather than a trade), the Revenue are quite happy for you to not bother letting them know. Obviously, once you are making profits, they will get very annoyed if you don't tell them.
BoRED S2upid said:
Good on you for even considering telling them. I know of a lot of people making hundreds buying and selling on ebay "just a hobby" so don't tell the VAT Man. Where I pay tax on every bean I earn. Doesn't seem fair to me and they will get away with it for years.
If they don't charge VAT on sales or reclaim VAT on purchases then it is none of the VAT man's business, assuming turnover doesn't exceed £64000.
But it may be the tax man's business (and the VAT man and the tax man are now one and the same person - now that HMRC runs both VAT and tax).
The Revenue have recently reminded people that trading on E-Bay is "trading" and must comply with the same rules and regulations as any other form of trading.
They have actually put some guidance up on their website for E-Bay and car boot traders.
The Revenue have recently reminded people that trading on E-Bay is "trading" and must comply with the same rules and regulations as any other form of trading.
They have actually put some guidance up on their website for E-Bay and car boot traders.
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