Register for Tax?

greeneye

JohalaReewi wrote:

Not strictly true, depends if it is income or capital gains.
You have an allowance for each.

For eBay specific advice, check the thread at

http://forums.moneysavingexpert.com/showthread.html?t=216489

Just read that thread and the conclusion seemed to be that Capital Gains Tax threshold is £6000 for the sale of a SINGLE item.

From what is usually discussed on here I was under the impression that you had an allowance of £6000 total for a given year of ALL sales.

So if the first premise is actually true in one year you could in theory sell 20 items (of your own personal effects) at say £2000 a piece and be liable for no CGT???

I ask because a relative has recently asked me to sell about £20,000 of specialist equipment he has aquired/collected over the last 50 years none of which would sell individually for over £6000 and I had assumed he would be liable for CGT.

Alfie_E

greeneye wrote:

Just read that thread and the conclusion seemed to be that Capital Gains Tax threshold is £6000 for the sale of a SINGLE item.

From what is usually discussed on here I was under the impression that you had an allowance of £6000 total for a given year of ALL sales.

As you’ve said, they’re different things. One is a threshold for each item of your personal effects. The other is an allowance for the year, which is currently £8,800.

To see why there’s a threshold, imagine it didn’t exist. You’d have to record ever time you sold an item for more than you’d paid for it, right through out the year, even if it had increased in value by pennies, just in case you went over the allowance later in the year. Not only would you have to record it, but you’d have to try to work out what it was worth when you got it. I don’t think many people keep their receipts for fifty years.

greeneye

Alfie_E wrote:

As you’ve said, they’re different things. One is a threshold for each item of your personal effects. The other is an allowance for the year, which is currently £8,800.

To see why there’s a threshold, imagine it didn’t exist. You’d have to record ever time you sold an item for more than you’d paid for it, right through out the year, even if it had increased in value by pennies, just in case you went over the allowance later in the year. Not only would you have to record it, but you’d have to try to work out what it was worth when you got it. I don’t think many people keep their receipts for fifty years.

Nicely explained Alfie - Well done ;+)

jordan_gibson

Thanks everyone!

Just e-mailed a friend who is an accountant and he has basically told me to wait until the new financial year (April) and then register with the tax man. He has 100% confirmed that the tax man is going for Ebay sellers "like a Vulture" this year and said it was suicide not to register if you ever re-sold an item for profit. Luckily, all of the items I have sold so far are from my house and have been mine for ages so should be in the clear.

He has already had a new client who had feedback from just 100 sales, from selling clothes, that has just been caught by the tax man and because he had not kept records the tax man has estimated his profit, and therefore how much tax he owes, and given him 30 days to pay it!!!!! - Ouch!!!

Bottom line from the advice I have just been given:- Keep records of everything you sell and purchase. If you sell the odd bits and bobs from about your house then still keep records but the tax man won't really be that interested. If you ever buy anything for the sole purpose of re-selling then you are trading and you must register!!

greeneye

jordan_gibson wrote:

Thanks everyone!

Just e-mailed a friend who is an accountant and he has basically told me to wait until the new financial year (April) and then register with the tax man. He has 100% confirmed that the tax man is going for Ebay sellers "like a Vulture" this year and said it was suicide not to register if you ever re-sold an item for profit. Luckily, all of the items I have sold so far are from my house and have been mine for ages so should be in the clear.

He has already had a new client who had feedback from just 100 sales, from selling clothes, that has just been caught by the tax man and because he had not kept records the tax man has estimated his profit, and therefore how much tax he owes, and given him 30 days to pay it!!!!! - Ouch!!!

Bottom line from the advice I have just been given:- Keep records of everything you sell and purchase. If you sell the odd bits and bobs from about your house then still keep records but the tax man won't really be that interested. If you ever buy anything for the sole purpose of re-selling then you are trading and you must register!!

WAITING FOR SNOOZE CONTROL'S REPLY TO THIS WITH BAITED BREATH!!!

jordan_gibson

greeneye wrote:

WAITING FOR SNOOZE CONTROL'S REPLY TO THIS WITH BAITED BREATH!!!

Yes, know exactly what you mean!!!! Hey, the way I see is that it's each to their own. I personally would rather register and then not have the tax man catch up with me later on.....just too honest I suppose but I'm a very big believer in 'what goes around comes around'!!!

Snooze_Control

greeneye wrote:

WAITING FOR SNOOZE CONTROL'S REPLY TO THIS WITH BAITED BREATH!!!

As a fully law-abiding citizen, I've absolutely no idea what you're referring to.

SC

greeneye

Snooze_Control wrote:

As a fully law-abiding citizen, I've absolutely no idea what you're referring to.

SC

Ahh Snooze you haven't gone straight have you?
I was looking forward to the board livening up again.

Thought you'd be dismissing the accountants input as scaremongering (possibly because he's looking for work) or maybe you might even have been a little nervous.

Or are you just keepin your head down know fella? ;+)

greeneye

Snooze_Control wrote:

As a fully law-abiding citizen, I've absolutely no idea what you're referring to.

SC

Ahh Snooze you haven't gone straight have you?
I was looking forward to the board livening up again.

Thought you'd be dismissing the accountants input as scaremongering (possibly because he's looking for work) or maybe you might even have been a little nervous.

Or are you just keepin your head down now fella? ;+)

greeneye

What is going on on this board - my messages keep duplicating if I edit them and then won't let me delete the duplicate afterwards.
And now the whole thread is repeating itself on page 2 ????