Can I avoid a fine? Have not yet registered as a business. HELP PLEASE.

cotsvale

About 15 months ago I started a craft stall to raise money for charity , I subsidise the stall with my own money. From my takings (not from profits)I give 1/3 to the charity, 1/3 goes to Table Fees and I keep 1/3 towards costs of materials/petrol etc, the 1/3 I keep no way covers what I spend far from it.

Recently I found out that as I am trading I should have registered as a business within 3 months. Have checked this with the tax office.

If you are found to be trading without being registered you can be fined a huge amount of money.

I want to register but if I tell them when I started will I get a fine? It is putting me off registering.

Gaffy

I believe the 3 month deadline was dropped sometime ago as they found it was putting people off from registering for self employment, instead it's a percentage of the profits for the time you weren't registered. However if you contact them first and just tell the truth, more than likely they won't fine you.

http://webarchive.nationalarchives.gov.uk/+/http://www.hmrc.gov.uk/about/new-penalties/faqs.htm#41

Don't forget to also inform the National Insurance Contributions office.

martindow

This sounds as if it may be a hobby business like the first part of example 1 here

http://www.hmrc.gov.uk/guidance/selling/examples.htm

But, I don't think you can count the donation as an expense as this comes from your income and you could make it gift aided if you have taxable income. Are you making a profit if you consider your takings minus expenses - table cost, materials, travel, etc.? It's surprising how all of the little expenses can add up. If there is still a loss it is not commercial activity.

Perhaps someone else can confirm that I am right here.

If you do find that you are making money and should have informed HMRC it is best to come clean rather than be found out. Accountants can advise on the best approach but of course this will be an additional expense.

Savvy_Sue

Gaffy wrote: »

Don't forget to also inform the National Insurance Contributions office.

It all happens through HMRC, however as you won't be making more than £6000 profit from your 'self-employed' work, you can ask for a certificate of exemption.

I actually wonder if you DO need to register. You are not doing this as a business, you are doing it as a hobby. You are not making a profit, so there is no tax to pay.

However, it's probably wise to keep records to prove that you're not making a profit ...

cotsvale

Thank you all.

Mistral001

As far as I can see, since you did not start trading before 6th April 2013 you have until 31st January 2015 to submit your tax return.

motorguy

Mistral001 wrote: »

As far as I can see, since you did not start trading before 6th April 2013 you have until 31st January 2015 to submit your tax return.

You still need to register the business ASAP though