Tax For Sale Of Puppies?
Discussion
Hi PH,
My girlfriends dog had a litter of puppies (4 of them) a few years ago and they were sold on. It was a one off thing, and nothing thought of it. However, she's had a letter from HMRC last week stating she may need to declare income from 'the breeding or sale of animals'.
She's obviously a bit worried about the implications of it, specifically the tax bill that might be faced and the letter stating there is only 90 days to pay it... We've been trying to read up on it but it all seems a bit of a grey area as to whether or not you need to pay tax for a one off thing like this - the docs on the gov website are vague and unhelpful IMO.
Just wondering if anyone else has faced similar / knows if something like this is subject to tax? I can understand if it's being done for a living but seems a bit odd for a one time thing.
My girlfriends dog had a litter of puppies (4 of them) a few years ago and they were sold on. It was a one off thing, and nothing thought of it. However, she's had a letter from HMRC last week stating she may need to declare income from 'the breeding or sale of animals'.
She's obviously a bit worried about the implications of it, specifically the tax bill that might be faced and the letter stating there is only 90 days to pay it... We've been trying to read up on it but it all seems a bit of a grey area as to whether or not you need to pay tax for a one off thing like this - the docs on the gov website are vague and unhelpful IMO.
Just wondering if anyone else has faced similar / knows if something like this is subject to tax? I can understand if it's being done for a living but seems a bit odd for a one time thing.
This has some useful info
https://www.ridgefieldconsulting.co.uk/tax-guides/...
Also remember, it is not the revenue subject to tax, but the profit. If selling the puppies is subject to tax, you should be able to deduct expenses (dog food, vet bills, etc.).
ETA: if it is considered trading then it tax is based on net income. If considered a hobby/side hustle then, as Countdown mentions, there is a £1,000 allowance, but this is gross income
https://www.ridgefieldconsulting.co.uk/tax-guides/...
Also remember, it is not the revenue subject to tax, but the profit. If selling the puppies is subject to tax, you should be able to deduct expenses (dog food, vet bills, etc.).
ETA: if it is considered trading then it tax is based on net income. If considered a hobby/side hustle then, as Countdown mentions, there is a £1,000 allowance, but this is gross income
Edited by Exiled Imp on Tuesday 1st October 06:19
Defcon5 said:
How did HMRC become aware of this? Did she sell them on a website that has subsequently reported transactions to them?
Could also be casual chat which gets relayed to a third party and then reported. It’s potentially a lot of money with certain breeds getting close to a five figure sum from one litter.
A few years ago in COVID times people were often paying thousands to buy a puppy. Isn't it supposed to be declared on a tax return in the miscellaneous income section.
How identified? Guess depends how/where they were advertised but HMRC have been gradually chasing down any undeclared income across various reselling sites.
How identified? Guess depends how/where they were advertised but HMRC have been gradually chasing down any undeclared income across various reselling sites.
trickywoo said:
Defcon5 said:
How did HMRC become aware of this? Did she sell them on a website that has subsequently reported transactions to them?
Could also be casual chat which gets relayed to a third party and then reported. It’s potentially a lot of money with certain breeds getting close to a five figure sum from one litter.
We used to breed pedigree CKCS pups as a hobby for several years, pre-Covid. Our accountant approached HMRC who were not interested. If every allowable expense were to be deducted from the gross sale proceeds we could have shown losses, not profits, each year. Could they have been used to reduce our employment PAYE taxation? Presumably, hence the HMRC attitude!
scot_aln said:
A few years ago in COVID times people were often paying thousands to buy a puppy. Isn't it supposed to be declared on a tax return in the miscellaneous income section.
How identified? Guess depends how/where they were advertised but HMRC have been gradually chasing down any undeclared income across various reselling sites.
Our puppy was purchased during Covid at a cost of £4,500. When my wife visited, it was obviously a council house and the 'breeder' had a substantial operation. How identified? Guess depends how/where they were advertised but HMRC have been gradually chasing down any undeclared income across various reselling sites.
It doesn't really matter what the product being sold is. HMRC has decided that the individual MIGHT be be running a business.
It's up to the taxpayer to prove that the transaction was NOT a business transaction or part of a series of business transaction.
HMRC has a specific description of what a business is. It is based around the notion that an activity has been or is being carried on with a view to making a profit.
If your girlfriend's transaction was a "one-off" and she doesn't intend to do it again on a regular basis, she should be able to argue that it was a personal, private sale and not a transaction carried out with any business intent.
It's up to the taxpayer to prove that the transaction was NOT a business transaction or part of a series of business transaction.
HMRC has a specific description of what a business is. It is based around the notion that an activity has been or is being carried on with a view to making a profit.
If your girlfriend's transaction was a "one-off" and she doesn't intend to do it again on a regular basis, she should be able to argue that it was a personal, private sale and not a transaction carried out with any business intent.
119 said:
PeteTaylor99 said:
Our puppy was purchased during Covid at a cost of £4,500. When my wife visited, it was obviously a council house and the 'breeder' had a substantial operation.
I’d love to know what breed cost £4500!
Cavapoo
He’s a lovely boy though so all is forgotten
That's why we get rescue dogs, always have, up to 2 years old they mostly come already house trained and jabbed/neutered and we've loved all 3 of them for many years. It gives a dog a chance at a great life where it is loved and cared for and it takes them out of that 6 by 4 concrete cell that they're crammed into at the rescue centre that they didn't deserve to be put in, mostly due to owner neglect or abandonment.
Our current greyhound Bea is an ex racing dog who got injured and was no longer of any use to her owner so she ended up at a greyhound rescue centre, she's wonderful but very greedy, she's the size of a small horse but so loving and gentle.
Our current greyhound Bea is an ex racing dog who got injured and was no longer of any use to her owner so she ended up at a greyhound rescue centre, she's wonderful but very greedy, she's the size of a small horse but so loving and gentle.
Edited by Gordon Hill on Thursday 3rd October 17:27
Gordon Hill said:
That's why we get rescue dogs, always have, up to 2 years old they mostly come already house trained and jabbed/neutered and we've loved all 3 of them for many years. It gives a dog a chance at a great life where it is loved and cared for and it takes them out of that 6 by 4 concrete cell that they're crammed into at the rescue centre that they didn't deserve to be put in, mostly due to owner neglect or abandonment.
Our current greyhound Bea is an ex racing dog who got injured and was no longer of any use to her owner so she ended up at a greyhound rescue centre, she's wonderful but very greedy, she's the size of a small horse but so loving and gentle.
A very admirable thing. We’d never had a dog before and our youngest children were toddlers so we wanted the puppy experience. We would do things differently in future.Our current greyhound Bea is an ex racing dog who got injured and was no longer of any use to her owner so she ended up at a greyhound rescue centre, she's wonderful but very greedy, she's the size of a small horse but so loving and gentle.
Edited by Gordon Hill on Thursday 3rd October 17:27
BenB91 said:
Did you have insurance on the puppies? If yes, the insurance provider would have been asked to pass details onto HMRC and contact everyone to see if a tax return is needed.
Do pet insurance providers ask you who you bought the animal from? What happens if you put down a fictional name/address or the name of somebody you don't particularly like ? As far as I'm aware there is no mechanism for Insurance companies to provide HMRC with these details and even less capacity for HMRC to record and follow up
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