Letter From HMRC Re: Ebay Account

Flyonthewall

MacMickster wrote: »

The problem with the very specific advice which was given is that it does nothing to help the business owner to actually understand her own business.

She can read through the advice on here and see what applies and look into things further. I fail to see how getting an accountant to tell them what's what gives them more understanding than reading advice on here yet you seemed to think that they should go to an accountant (aside from for cost reasons). If anything that gives them less understanding! They're not learning about different aspects, getting advice from people with experience or looking to see what works with their business. Instead they'd just be told by an accountant"this works, do that".

Depending on the specific nature of the business then that advice may not be appropriate (for example the £45K business turnover may be from selling 6 second-hand caravans at an average of £7.5K each), Postage may not have any part in the business.

Then they'd ignore that bit. I should hope that OP wife would have more sense than to sort out postage discounts/cheaper postage options if they weren't posting anything! However, it's far more likely they are posting items and that could be a big help. It could also help others in a similar position.

Same goes for the other advice. They can look through and see what applies.

The best advice that can be given to any business owner is to fully understand their business model, and to constantly review suppliers, overheads etc looking for better value. Running a successful business is not simply about following steps a, b and c then job done.

Rather than paraphrasing the advice why did you not say exactly that? You need to fully understand your business model, review and research and work out what's best for your business.

See that's fine and I completely agree with that. That's something the OP can read and think about. They can use that advice along with the advice in the other posts.

Polarbeary

Wonder why HMRC don't go after huge corporations instead.

Flyonthewall

Polarbeary wrote: »

Wonder why HMRC don't go after huge corporations instead.

They go after anyone who they think isn't paying tax when they should be. Just because a company isn't huge or it's a sole trader doesn't mean that they don't owe tax. In some cases a lot of tax!

There have already been posts on this.

Polarbeary

Flyonthewall wrote: »

They go after anyone who they think isn't paying tax when they should be. Just because a company isn't huge or it's a sole trader doesn't mean that they don't owe tax. In some cases a lot of tax!

There have already been posts on this.

Amazon. Apple. Starbucks. Etc.

Funny how HMRC are quick to demand money but very slow to pay back tax owed isn't it. They also take months to reply to correspondence and don't answer their telephones.

kimi1977

I'm surprised anyone is making anything on ebay or amazon, they copy the idea and go direct to the supplier themselves, specially amazon who have killed thousands of little fish businesses in the last few years.

Takeaway_Addict

Polarbeary wrote: »

Amazon. Apple. Starbucks. Etc.

Funny how HMRC are quick to demand money but very slow to pay back tax owed isn't it. They also take months to reply to correspondence and don't answer their telephones.

They all declare and pay what they are legally required to at the end of the day, the OP's wife may not be as she is not declaring.

lovinituk

kimi1977 wrote: »

I'm surprised anyone is making anything on ebay or amazon, they copy the idea and go direct to the supplier themselves, specially amazon who have killed thousands of little fish businesses in the last few years.

eBay don't sell anything so they don't copy anybody.

With Amazon, make yourself the highest point in the chain and sell directly to Amazon. Works well if you have the right products.

Flyonthewall

Polarbeary wrote: »

Amazon. Apple. Starbucks. Etc.

Takeaway_Addict wrote: »

They all declare and pay what they are legally required to at the end of the day, the OP's wife may not be as she is not declaring.

^ This. As I've said previously in this thread (hence why I said there are already posts on it, thought you may read them rather than create a repeat discussion).

Funny how HMRC are quick to demand money but very slow to pay back tax owed isn't it. They also take months to reply to correspondence and don't answer their telephones.

Demanding money is a case of sending out a letter, for which they'd have templates for. A quick process.

Paying money back means checking forms, working out what is owed, they may well do checks to be sure everything is correct and legit, then they have to go through the system to process the refund, then there's allowing time for the money to actually go through. It's not all automatic and instant. Certain times of year will also be really busy and so it may take longer.

Plenty of people do manage to contact them. How long replies take no doubt depends on what they're replying to. Some things may require investigating first or whatever so it's bound to take longer.

Maybe they could improve communications, I don't know, but sending a standard letter is going to be quicker than replying to a specific issue.

motorguy

ovengloves wrote: »

This is not a wind-up. I've been looking at the replies before contacting HMRC.
My wife is not registered self employed. Perhaps naively, we thought Ebay earnings should be declared only if you exceed the personal earning allowance. I now understand this isn't the case. The last thing we would want to do is fall foul of HMRC.
I guess some of you are saying serves you right. What I'd say to that is we may have been daft but we've been honest. My wife works extremely hard in difficult personal circumstances to make a small earning (less than £5K). She is proud to claim nothing from the government and we're self-sufficient. She earns a small margin on sales (if anyone can earn 35-45% in an overcrowded market like Ebay, please give the magic formula), and sometimes sells at a loss to get rid of old stock. The problem is proving this.
We're just going to have to throw ourselves to the mercy of HMRC. Whatever they say has to be paid we'll pay. I just hope other people don't make the same mistake.

So, just to be straight - your wife has a £50,000 a year turnover business but decided she didnt need to keep records, register with HMRC and submit tax returns?

What made her think she was special compared to other small businesses?

Hardly a surprise it has ended badly is it?

motorguy

Polarbeary wrote: »

Amazon. Apple. Starbucks. Etc.

Funny how HMRC are quick to demand money but very slow to pay back tax owed isn't it. They also take months to reply to correspondence and don't answer their telephones.

I had two tax refunds last year and both came exactly when scheduled and when expected.

They always answer the phone when i ring and provide advice when asked.