2nd income - lots of advice needed

havekidsamskint

I have a hobby that could make me some extra money but I do need to spend about £2-£300 to get it set up again, I'd have to use the credit card.

This is a hobby where I sell handmade crafts, do I need to declare to the taxman or can I just sell at craft fairs and things. I would only estimate a profit of £3-400 per year for lot of work and I also have a p/t job as well

I would appreciate any advice as I dont know whether to to this as a "mini cottage industry" or sell my basic tools probably worth about £50 and put this to my £1400 overdraft

thanks for looking

Prudent

Are you up to your tax limit with your part time earnings? If not, you may not have to pay tax anyway.

I would tend to look on something like this as funding my hobby plus a little extra bonus. My hobby is entering competitions and as you can see from my signature, I am looking for it to make enough for me to offset my internet access (my extra bonus). I also look for it to pay back any costs like stamps.
I never really consider it ' income' but it can add a fair bit to our quality of life.

seven-day-weekend

If you sold at craft fairs and things, it would be classed as a business and you would need to declare it for Tax and NI purposes, but whether you actually have to pay any tax or NI depends on other income you have.

hypno06

Definately declare it - it is not worth the risk of being caught out in my opinion, but whether you actually have to pay tax will depend on your other outgoings, expenses plus your other income.

You need a hobby so what better way of enhancing this than by making extra money from it! Before you buy the extra materials, work out what you would expect to make and how much you would expect to sell it for. That may give you an idea as to how long it would be before you recoup your costs and make a profit.

I would say go for it - something to enjoy and potential to pay off the debts quicker.

Good luck, whichever way you play it.

tyllwyd

If you already have a part-time job, what is your hourly rate for that? If it was me, I'd balance up the hourly rate for the job against the hourly rate you can realistically achieve with your crafts. Another factor is what you enjoy doing, of course. Would getting a second part-time job be an option?

TTMCMschine

Prudent wrote:

Are you up to your tax limit with your part time earnings? If not, you may not have to pay tax anyway.

I would tend to look on something like this as funding my hobby plus a little extra bonus. My hobby is entering competitions and as you can see from my signature, I am looking for it to make enough for me to offset my internet access (my extra bonus). I also look for it to pay back any costs like stamps.
I never really consider it ' income' but it can add a fair bit to our quality of life.

Unfortunately it doesn't matter how you "would tend to look on it," what matters is how the tax manlooks on it, & I can pretty much assure you that he won't be best pleased if you tell him you didn't declare it because in your eyes it was your little "extra bonus" & you didn't consider it "income."

Declare it, you'll never hear the end if he catches you.

Prudent

Competitions prizes are tax free. I am not advocating illegal activity!

FatJock

Prudent,

would you be able to give me some pointers on where to enter competitions? i wnat to start doing this but not sure where to start. You can PM me if necessary.

HAVEKIDSAMSKINT - sorry if this hijacks your OP a little. My advice (for what its worth) would be to inform the taxman or seek guidance from the CAB. Definately not worth the hassle if the taxman decides you've been hiding money from them.

Regards & Thanks,
FatJock

Prudent

Have a look on the competitions board. Loads are listed, with links to the entry forms. Most people give the answers. Read the advice on the board and do join the comping challenge, there has been a fantastic response.

havekidsamskint

thanks for all your replies

I have worked out that if I spend about £1000 over the year I may get back about £1400. If I offset petrol to & from shops & fairs to get my basic goods I will probably make about £200 over the year, this would be me making things almost all of my spare time. I'm told I am good but I lack confidence to charge a lot so I usually only charge for the materials so that I am only making as a favour, but I usually pay it out first.

I use all my tax allowance in my job and as it's shift work I cant get another job, it would not fit in with OH & kids.

I do enjoy crafting but it is costly so I thought I could maybe recoup some money, I did not think I would be in a lot of trouble from the tax man but now I will need to rethink.

thanks all for your replies, I'll let you know what I decide to do.

cheers:beer: