[hughesy]

It doesn't matter if it's ebay, a car boot sale or if you've got a string of department stores around the world. If you're in business you're liable for tax on your profits. Just because of the convenience of selling on ebay lots of people do make considerable sums of money and think they can get away with it. The revenue man is well aware of this and has been for a long time. Especially people on the dole with hundreds of items listed on ebay.

[Womble]

If you're in business.....

Aye, but that's the key isn't it?

I traded in my car a month ago, but kept the winter tyres, which I flogged on Fleabay. OK, so I made a loss overall because they were used, but say I'd broken even, or even made a small profit, does that mean I'm in business and should therefore declare it? 

I always thought that the distinction was whether you were buying or making the goods in the first place, with the intention of selling them on.  Is that correct though, or not?

[Sandy]

Now selling your used stuff is difficult to put a tax on as you have bought it at a cost, used it then sold it on so its not actualy profit just money back surely??

[princesspiggy]

im thinking u can earn up to £7 pa without declaring it? or paying tax on it.
it will take a few fair fox skulls to make a profit, bearing in mind i had to buy the woodlands first...lol
 

[doganjo]

There are a lot of misconceptions here - Whatever you sell has a value - whether purchased yesterday or a hundred years ago.  The selling price, minus that value, and any associated costs is what you would be taxed on, regardless of whether it is £7 or £107, and whether you are a registered business or not.

For example, I am not in business, I am retired, I have numerous paintings that John bought some years ago.  They were valued for his estate when he died.  If I now sold them for more than that value I would expect to pay tax on the difference less any costs I incurred in selling them.

Each individual transaction is not taken on its own - the total sales, expenditure, and purchases figures in any year from 6th April to 5th April are added up and the profit (or loss) is then calculated.

[Womble]

Thanks for that Annie.

How about this one then?  So far this year, our holding has had an income of £119, vs expenditure of £400 on animal feed etc, and £250 on capital items. (This time next year Rodney.......)

Does that mean I can offset the loss against my taxable income at the end of the year?  And I suppose the question is, if not, why not?! 

[doganjo]

Yes, ask for a self assessment form.

[princesspiggy]

vs expenditure of £400 on animal feed etc,

i sooo wish that was us!!! our feed bills makes u break out in a sweat! 

[Sandy]

And, if I bought a new dress @£30 but did not like it so sold it for £10 or less the next day on E Bay?

[princesspiggy]

in my opinion business is business. a hobby is a hobby. one pays tax and insurance and the other doesnt. clothing for business can go thru the books the same as other expenses.

[Womble]

I guess that's the problem Princesspiggy, when is it a hobby, and when is it a (rather poor) business? I already do a self assessment, but have always put down 'other income' as zero, rather than £-500! It's certainly a bit of a minefield -  Tax needn't be taxing eh? 

i sooo wish that was us!!! our feed bills makes u break out in a sweat! 

To be fair, we've still got a chest freezer full from that lot, which will keep us going a wee while longer. The scary thing is that this is the first time we've kept proper records of income / expenditure, and it's very quickly become apparent that we need to keep working to support this lifestyle, rather than have the lifestyle support us!! 

[princesspiggy]

I guess that's the problem Princesspiggy, when is it a hobby, and when is it a (rather poor) business?

id say when u start advertising stock/services etc then u need business insurance  and need to do a tax return etc.
depends on ur perspective if profit is abit awol. 

[doganjo]

And, if I bought a new dress @£30 but did not like it so sold it for £10 or less the next day on E Bay?

You'd be a bit silly! 

But in theory, at least, you could deduct the loss from your profits in a  business or other taxable income - download a self assessment form as I said!

[doganjo]

If you are only selling the odd item from time to time then it wouldn't necessarily be classed as a business by HMRC, but if you have a regularly used account with Ebay or other such internet sites then you do need to keep records.  HMRC have been watching car boot sales for years.  I had a client up north who had a small antiques business, and when the rent on his shop sky-rocketed he gave it up and concentrated on smaller items and going to boot sales - HMRC caught up VERY quickly and he asked me to help him at that point, to sort out an HMRC investigation.  We succeeded! 

[Sandy]

I got interrupted when putting my post and I doubt that would ever happen to me, I am more likely to buy a dress off e bay anyway!