Spares or Repair?

fred7777

FiftyPents wrote: »

I genuinely had no idea I had to register as a business account, I just considered it a hobby. What do I have to do? Just change my account to business on ebay? Would I have to pay tax, v.a.t etc? I suppose i'd be better off just stopping then.

Whether ebay think you are a business and HMRC think you are a business are completely different things.

In this case as you bought the laptop with the intention of using it so you don't really count as a business in either case. Your profit would fall under capital gains and be well within your allowance.

If you are just buying and selling the odd item don't worry. If you are selling a large amount then you have to get things sorted.

But give it a go first before registering as a business as you may find it very difficult to make it worthtwhile. Buy and item for £5 and sell for £10 with £4 postage (at cost) VAT will take £2, ebay will take another £1 final value fee and £15p-25p insertion fee and paypal will take a 70p fee for the payment . So you make £1.05 profit on which you will pay tax and NI reducing your £5 profit to around 75p:eek:

mcjordi

ask on the techie board on here they will help.

Hammyman

Crowqueen wrote: »

I think Hammyman knows about laptops - hopefully he'll be around, or you can PM him.

Someone called???:rotfl::rotfl:

Absolutely every time they are worth more in parts than they are even if you go to PC World and pay full retail. HOWEVER it can take a fair while to sell them all and get the money. I've still got keys from some keyboards I've had a year.

Going on what you said you'd have in it with a £44 screen, you'd make about £40-£50 selling it as a fully working machine for about £140.

Selling it as spares based on the prices below, assuming everything sold you could get between £220 (selling keyboard as a whole) to £425 (selling individual keys). If you sold each individual key on the keyboard for £2.50 each, you could get £220 just for the keyboard!! As you may gather, I love it when people bring me laptops with knacked keyboards - doesn't matter if they've had drinks spilled on them as I just want the key, hinge and rubber nipple.

Some ideas of prices for the one you have..
Palmrest with no colour worn off on palmrests or mouse buttons £20
Lid £15
Bezel £10-£15
Hinges £15-£20 a pair
Bottom cover with CoA on £20 or so
Battery (if it holds a decent amount) £15 or so
Keyboard - either sell the entire thing complete for £10-£15 or sell each key individually for £2-£2.50 a time.
Working mainboard £50-£75
1GB stick of DDR2 £10
160GB HDD - £15-£20

Regarding the mainboard, I've seen some Dell models (Dell Latitude D630) going for £150.

There's definitely money in it but you don't want to be bothering with stuff older than 4-5 years. With laptop models such as the £300 ones Tesco sell, its almost worth buying a new one just to break it and sell for parts. You'd double your money and they're such naff build quality that most will need parts - mostly hinges, screens and keyboard keys.

And of course by having a large parts stock, if you can find a working machine which is only missing a few keys which you can usually get for next to nothing, you use the parts you have to turn it into a fully working machine and make a quick £100 or so that way.

Hammyman

fred7777 wrote: »

But give it a go first before registering as a business as you may find it very difficult to make it worthtwhile. Buy and item for £5 and sell for £10 with £4 postage (at cost) VAT will take £2, ebay will take another £1 final value fee and £15p-25p insertion fee and paypal will take a 70p fee for the payment . So you make £1.05 profit on which you will pay tax and NI reducing your £5 profit to around 75p:eek:

Err, no. In my first trading year on a turnover just shy of £25k, I made a loss on paper of £88. Every week I put money in the bank....

And there was no fiddling at all of the books and every sale went through. However if I go to the auction (212 mile round trip) and because its a silly expensive day I only buy 3 laptops which I make £30 on each when I sell, ON PAPER £84 of that £90 is claimed as mileage at HMRC rates so ON PAPER, I've only made a profit of £6 however the reality is I made £90 minus the £25-£30 REAL cost of doing the journey to pick them up and it is the £60-£65 that I put in the bank. So instead of paying tax on £90, by the time the paper expenses are taken off I pay tax on £6.

fred7777

Hammyman wrote: »

Err, no.

Err, yes

In the example you gave you are making money on the difference between the cost of your journey and what you can claim against tax for that journey.

If you had not done the journey then your tax would be much higher and the OP never said anything about making tax deductible journeys.

motorguy

:j

fred7777 wrote: »

If you are just buying and selling the odd item don't worry. If you are selling a large amount then you have to get things sorted.

It is not up to you or i to decide if tax is payable. If you are buying with the intention of selling for profit, then you MUST declare this as a business to HMRC.

Remember that ALL ebay transactions are audited, and can be called upon by HMRC at any time.

FiftyPents

Hammyman wrote: »

Someone called???:rotfl::rotfl:

Absolutely every time they are worth more in parts than they are even if you go to PC World and pay full retail. HOWEVER it can take a fair while to sell them all and get the money. I've still got keys from some keyboards I've had a year.

Going on what you said you'd have in it with a £44 screen, you'd make about £40-£50 selling it as a fully working machine for about £140.

Selling it as spares based on the prices below, assuming everything sold you could get between £220 (selling keyboard as a whole) to £425 (selling individual keys). If you sold each individual key on the keyboard for £2.50 each, you could get £220 just for the keyboard!! As you may gather, I love it when people bring me laptops with knacked keyboards - doesn't matter if they've had drinks spilled on them as I just want the key, hinge and rubber nipple.

Some ideas of prices for the one you have..
Palmrest with no colour worn off on palmrests or mouse buttons £20
Lid £15
Bezel £10-£15
Hinges £15-£20 a pair
Bottom cover with CoA on £20 or so
Battery (if it holds a decent amount) £15 or so
Keyboard - either sell the entire thing complete for £10-£15 or sell each key individually for £2-£2.50 a time.
Working mainboard £50-£75
1GB stick of DDR2 £10
160GB HDD - £15-£20

Regarding the mainboard, I've seen some Dell models (Dell Latitude D630) going for £150.

There's definitely money in it but you don't want to be bothering with stuff older than 4-5 years. With laptop models such as the £300 ones Tesco sell, its almost worth buying a new one just to break it and sell for parts. You'd double your money and they're such naff build quality that most will need parts - mostly hinges, screens and keyboard keys.

And of course by having a large parts stock, if you can find a working machine which is only missing a few keys which you can usually get for next to nothing, you use the parts you have to turn it into a fully working machine and make a quick £100 or so that way.

Hammyman, since you're a pro in this kind of thing, is it ok if i ask you a few questions via pm, or maybe email you about it?

Hammyman

fred7777 wrote: »

Err, yes

In the example you gave you are making money on the difference between the cost of your journey and what you can claim against tax for that journey.

If you had not done the journey then your tax would be much higher and the OP never said anything about making tax deductible journeys.

My journey to the post office half a mile away is a tax deductible journey even if I walk (HMRC mileage rate - 2p per mile on foot)

Unless they get everything delivered direct to their premises and collected from them, and that is EVERYTHING down to a paperclip, then there is tax deductible mileage.

But regardless, the original example was wrong by a good 300%.

fred777 wrote:

But give it a go first before registering as a business as you may find it very difficult to make it worthtwhile. Buy and item for £5 and sell for £10 with £4 postage (at cost) VAT will take £2, ebay will take another £1 final value fee and £15p-25p insertion fee and paypal will take a 70p fee for the payment . So you make £1.05 profit on which you will pay tax and NI reducing your £5 profit to around 75p

Firstly, until you have a turnover of £70,000 you don't have to register for VAT so there is no VAT element.

So lets take the sale step by step for a business seller in the Computing category.

Sale of £10, postage of £4.

Ebay: Listing fee 20p
FVF: 52.5p (5.25% on sales of £0.01 to £29.99 in technology categories)
Paypal: 57p (fee charged on total payment including postage)

So out of the £10 sale you've got (after postage and assuming its £4) £8.70.

So you've made a pre-tax profit of £3.70. Now I mentioned PRE-TAX because until you know what your total gross profit is at the end of the financial year, you don't know whether you'd actually pay any tax on that. For example, if I'd made that sale last year in my business, I'd not have paid any tax.

So assume you pay tax at 20%, you still end up with £2.96.

And even if you were VAT registered, you'd only be paying VAT on the profit under the margin scheme, not the full amount so you'd only deduct 20% off the £5 but would only pay income tax on £4 and would end up with £2 instead of £2.96 but then that doesn't take into account the VAT you'd be reclaiming on your Ebay and Paypal fees so its more like £2 and change.

A bit more than the incredibly wrong plucked out of his a$$ figure of 75p that Fred came up with...

Hell, I make over twice that selling a laptop key for £2.99 with free postage even though out of that £2.99 I've got a 20p listing fee, 16p FVF, 30p Paypal fee, the cost of an envelope, a sheet of paper and a stamp to deduct.

Hammyman

FiftyPents wrote: »

Hammyman, since you're a pro in this kind of thing, is it ok if i ask you a few questions via pm, or maybe email you about it?

I'll send you a PM with my email address...

sequence

I have tried this in the past on a small scale, but found it difficult to turn over enough parts to make any money. You can definitely make a profit on parts, but selling enough to make it worthwhile is difficult.