Inland Revenue cracking down on traders on eBay

martindow

Re post no 6, you can claim 40p/mile for casual business mileage up to 10000 miles and 25p/mile from then on. These rates were for 2005/2006 and may be different for this tax year.
Re post no 12 CGT will only become a possible issue if you set a proportion of your house costs against the business. You have an annual CGT allowance that can be set against this so it will not automatically be a problem.

N9eav

martindow wrote:

I bet you're making a loss on your chickens. We certainly did when we sold a few boxes - they were eating a lot of organic corn!

You are right there. And the kids keep borrowing the money from the chicken pot for stuff....:rotfl:

FloFlo

Re. the stock in hand, I didn't show any start up costs for the business just used my own money for stock, as this is still my first year and I haven't submitted my tax return yet, can I show x amount as start up costs to cover stock purchased.

FloFlo

martindow wrote:

Re post no 6, you can claim 40p/mile for casual business mileage up to 10000 miles and 25p/mile from then on. These rates were for 2005/2006 and may be different for this tax year.
Re post no 12 CGT will only become a possible issue if you set a proportion of your house costs against the business. You have an annual CGT allowance that can be set against this so it will not automatically be a problem.

Would we have to inform the car insurance in order to claim casual business mileage.
Thanks.

windswept

FloFlo wrote:

Re. the stock in hand, I didn't show any start up costs for the business just used my own money for stock, as this is still my first year and I haven't submitted my tax return yet, can I show x amount as start up costs to cover stock purchased.

Yes, partially,as long as you have all receipts, it doesn't matter where the money comes from to fund start up, I used an interest free cc.
I am in the same position as you, it's our first tax return this time too, as for stock , say you have spent £1000, and have sold £500's worth for £1000, and you have had expenses of £100, on p&p etc.
your cost of sales is £500, your gross profit is £500 - your expenses of £100 = net profit of £400 which will be taxed at 22% if you have already used your tax limit in other employment etc. as I said before, even if you spent £10,000 on stock, it does not count until sold. which is why you have to work out cost of sales.
Have you downloaded the relevant tax forms from last year to give you a feel for what's needed? I found doing that very helpful.

windswept

Don't forget, you can reduce your tax burden greatly by counting ALL relevant expenses, i.e. ebay and paypal fees, mileage/ bus fares to the p.o . car park fees, stamps, ink , paper, packaging materials, if you use it for the business, it goes down!
believe me, you will be amazed at just how many expenses you have, we have even more because we sell at toy fairs etc. and have our own market stall-can't wait to use it for the 1st time!
As long as you keep the receipt and it is relevant to the business you can use it.

coultog

Just a word of caution to some people... Don't get worried about making a couple of hundred quid off of eBay in a year. I'd be worriedif you're a PowerSeller and you're not declaring your income. HMRC will be looking at PS first IMHO!

FloFlo

I am not working (HE full time) OH works, which is why I am declared self employed, so I won't pay tax on the first £5000 or so. hopefully once I'm qualified we'll swap over and I'll work and OH will take over.

Redbedhead

coultog wrote:

Just a word of caution to some people... Don't get worried about making a couple of hundred quid off of eBay in a year. I'd be worriedif you're a PowerSeller and you're not declaring your income. HMRC will be looking at PS first IMHO!

I agree with this. I think they will go for the 'big fish' first as that is where they stand to make more money if something is amiss.

Snooze_Control

Redbedhead wrote:

I agree with this. I think they will go for the 'big fish' first as that is where they stand to make more money if something is amiss.

That's what I've been saying all along but the Ebay police on here continue to scare-monger people in believing otherwise.

:rolleyes:

SC