CGT limit per year

neas

Hi all,

I've been selling alot of junk recently and nearing the 2-3k limit already earned for this 'tax' year.

Is there a limit on ebay for which the tax man becomes involved? If so my wife can sell the rest of the stuff on her ebay account. Dont want to pay tax on stuff i paid twice as much for 10 years ago!

Hintza

You have no need to worry selling your own stuff will no attract capital gains tax. Mainly because you will not be making any profit on it hence no GAIN.

If howeverr you have bought struff to resell then that is a different kettle of fish.

neas

well say i bought stuff off ebay for 5 pounds then sold it for 10 pounds.

Some of the stuff i've made a small profit on, is there some limit im allowed? Cheers

soolin

neas wrote: »

well say i bought stuff off ebay for 5 pounds then sold it for 10 pounds.

Some of the stuff i've made a small profit on, is there some limit im allowed? Cheers

If you buy and resell even second hand goods then you need to declare it to HMRC. There is no lower limit, technically even £1 profit would be subject to income tax, but you do of course have personal allowances and if you have any of those left from your main employment you can set them against your profit.

This thread might be useful to you:
http://forums.moneysavingexpert.com/showthread.html?t=1565599

harry.zoop

My nephew started selling his fishing tackle in batches and it came to just over £2000 in 6 months. He got a tax return form the next year which was very strange. Might be a coincidence but it was his first one ever. I think Ebay are obliged to report Ebay sellers that reach a certain threshold.

neas

I had 200 quid worth of tesco vouchers which i used to buy 400 pounds worth of product at tesco.

I sold them at a loss for 300 pound on ebay. That isnt profit is it? I paid 400 pound (with vouchers) to get 300 poudns back. VAT and that were already paid in the supermarket.

I guess i best start keeping my receipts as proof lol.

chja

As has been said, if you are selling for less than you paid, then there is no gain and hence no tax.

If you sell for more than you paid, then CGT could arrise. For individuals this is 18%, with an allowance of £10,100 in the 2009/10 tax year (the amount of gain that you can make before CGT applied, not the amount that you sell for).

If you are buying to sell then you are a business and other considerations such as corporation tax - in this case, speak to an accountant for advice.

chja

neas wrote: »

I had 200 quid worth of tesco vouchers which i used to buy 400 pounds worth of product at tesco.

I sold them at a loss for 300 pound on ebay. That isnt profit is it? I paid 400 pound (with vouchers) to get 300 poudns back. VAT and that were already paid in the supermarket.

I guess i best start keeping my receipts as proof lol.

Interesting scenario - could be seen as a £100 profit or a £100 loss, but could even be seen as a £300 profit as you did not pay for the vouchers in the first place.

Again, one for an accountant if you need a response that you can relly on.

neas

either way am def keeping receipts..

JCS1

chja wrote: »

Interesting scenario - could be seen as a £100 profit or a £100 loss, but could even be seen as a £300 profit as you did not pay for the vouchers in the first place.

Again, one for an accountant if you need a response that you can relly on.

Trading Account extract:

Turnover = £300
Less cost of sales = zero
Net profit = £300

RFW

For proper advice consult an accountant or HMRC, who can be helpful.

Even if someone claims to be knowledgeable on here you can't rely on it to be accurate.

If you buy specifically to resell you need to register for tax, even if you make a loss, a good accountant would help with offsetting losses against other earnings.

HMRC have bots trawling Ebay for Income Tax and VAT evaders and a special team working on it.