Self Employment start date and general advise - Please Help!

suzanna

Hi

My Partner decided to sell some of his personal items on Ebay in January this year, It seemed to go well and it sort of took of from there.

He saw the potential and brought some items in to sell on as well. When he got to feb he was still selling his own personal items and a few bits he brought in and by march it was pretty much all stuff he brought in. The end of March and the beginning of April have been very good and he is now established as a power seller.

My question is that this started of as a sort of hobby and then turned into a business, at what point do you decide on a date to go self employed, i really wanted to start from this tax year as it would mean one less tax return to fill out but i dont want to get into any trouble, He did not make a profit upto April as he was spending out to buy in stock and has been told by some people not to bother and to start from April.

I dont have any knowledge on being self employed and he does not have a clue either and we dont know where to start and are finding it all a bit overwhelming, i'm sure when i know what i'm ment to be doing i will be fine and it's probably not anywhere near as scary and complicated as i think it is.

Sorry to ramble on (i hope what i have typed has made some sort of sense) I want to make sure everything is in order so any advise on starting up, what to keep/not keep, expenses and tax tips would be most helpful and might help me sleep a bit better at night.

Thank you

Suzanna

Townley&Co

Hi Suzanna

You have a PM

L Townley
Townley & Co Accountancy Services

WHA

He started "in business" when he first sold an item that he bought with the intention of selling. All his own things (i.e. things he bought with the intention of using them himself) are exempt and nothing to do with business. Anything he bought with the intention of sale are business items.

He has three months from the "start" to notify HMRC.

He needs to kept accurate records of the costs of items bought, proceeds of items sold, inventories of stock at each year end, records of expenses. Remember that "sales" values for accounts and tax returns are the amount paid by the customer, not the amount he actually received, ebay and paypal fees need to be recorded and shown as an expense.

The thing to worry about is to make sure that the book-keeping is complete and accurate and to make sure that you are claiming all the expenses to which you are entitled, i.e. proportions of use of home, broadband, computer, postage, mileage (to suppliers and post office), etc etc.