Very small business

[jimothy]

My missus makes greetings cards for fun. If she were to sell a few of them for a small amount of money (we're talking less than a hundred a year) are their any tax implications? I'm asking as a friends company wants to buy some and expense them so would need a receipt. Can she just sell them, do a personal receipt and not have to worry?
Thanks in advance.

[smartie]

officially - no.

in practice, yes, dont worry about it.

[pgilc1]

smartie said:

officially - no.

in practice, yes, dont worry about it.

Officially Yes.

[smartie]

if she only covers her costs, and is not intending making a profit then it could be seen as a hobby business, but the Revenue really dont like them...........

[Eric Mc]

Is he making a profit at what she does?

Does she intend to make profits?

If she answers yes to either of the above, she is, in the Revenue's eyes, trading. Therefore, she would need tp provide the details of her profits or losses each year to the Revenue. She should also notify the Revenue for Class 2 NI purposes but she would ne eligible to claim the Small Earnings Exception from having to pay this as she is well below the current profit threshold for Class 2 (£4,825). However, you are supposed to notify and apply for the exemption.

[The Moose]

What are the cards like? i am in need of a few!

Drop me a PM!

Cheers

The Moose

[jimothy]

Eric Mc said:

Is he making a profit at what she does?

Does she intend to make profits?

If she answers yes to either of the above, she is, in the Revenue's eyes, trading. Therefore, she would need tp provide the details of her profits or losses each year to the Revenue. She should also notify the Revenue for Class 2 NI purposes but she would ne eligible to claim the Small Earnings Exception from having to pay this as she is well below the current profit threshold for Class 2 (£4,825). However, you are supposed to notify and apply for the exemption.

I guess she would be making a small profit, but I can't imagine it will be more than a few tens of pounds. It seems a lot of hassle signing up with HMRC just for £50ish I would say I'm surprised there isn't a rule along the lines of 'if its only a few quid, don't worry about it' but I guess that doesn't fit in with Gordo's policies.

Ah well, she'll just have to keep doing them for pleasure and give a few to the guy who wants them, and he can buy her a christmas present or something...

Thanks, you are a mine of information as always!

Edited by jimothy on Wednesday 26th November 10:55

[Eric Mc]

jimothy said:

Eric Mc said:

Is he making a profit at what she does?

Does she intend to make profits?

If she answers yes to either of the above, she is, in the Revenue's eyes, trading. Therefore, she would need tp provide the details of her profits or losses each year to the Revenue. She should also notify the Revenue for Class 2 NI purposes but she would ne eligible to claim the Small Earnings Exception from having to pay this as she is well below the current profit threshold for Class 2 (£4,825). However, you are supposed to notify and apply for the exemption.

I guess she would be making a small profit, but I can't imagine it will be more than a few tens of pounds. It seems a lot of hassle signing up with HMRC just for £50ish I would say I'm surprised there isn't a rule along the lines of 'if its only a few quid, don't worry about it' but I guess that doesn't fit in with Gordo's policies.

Ah well, she'll just have to keep doing them for pleasure and give a few to the guy who wants them, and he can buy her a christmas present or something...

Thanks, you are a mine of information as always!

Edited by jimothy on Wednesday 26th November 10:55

There are no "de minimis" levels. Therefore, any failure to notify the Revenue constitutes tax fraud as well as a breach of the Money Laundering Regulations.

You can return tiny profits like this as "Sundry Income" on a Self Assessment or Short Form tax return.