Ebay, HMRC and Tax on sales?

RFW

forgotmyname wrote: »

You dont need to sell at a profit to be a business though. To be successful yes. But plenty out there selling for too little.

It's not that uncommon for successful businesses to not technically sell at a profit. If I remember correctly Amazon have only in the last year started to show a profit.

As for the OP, Ebay can say what they like, people on here can similarly do so but it is ultimately between you and HMRC so they're the best to ask.

forgotmyname

Yeah but how many small businesses can afford to sell at a loss for any length of time?

Especially ones being legit and declaring their earnings properly, too much smoke and mirrors with larger companies.

How can a company that makes zero profit for xx years afford to pay its staff year after year and pay those high up huge bonuses for making a loss? Get a free factory and tax breaks to employ the local people until the perks dry up when you move elsewhere?

A bit off topic, unless the OPs rivalling the large companies out there

kiyamr2

bris wrote: »

Your accountant.


Bottom line is you sell for profit, it's a business and the tax man couldn't care less what status your Ebay account has.


HMRC do check Ebay sellers, they have a team looking for sellers like you.

Does this not change the way things are?
https://jf-financial.co.uk/2018/01/01/1000-tax-free-trading-allowance/

Would it still be classed as a business?

steveE2

kiyamr2 wrote: »

Does this not change the way things are?
https://jf-financial.co.uk/2018/01/01/1000-tax-free-trading-allowance/

Would it still be classed as a business?

It is still classed as a business.

There are two separate issues here
1.Registering as a business seller is a legal requirement if you buy,make or grow items to resell, with a hefty fine if prosecuted.
2.You need to register with HMRC,whether you pay any tax or not will depend on your profits and other income.

Pun

forgotmyname wrote: »

Just takes one buyer to inform the tax man.

The words 'wildly improbably' spring to mind...as you say, there have been 'several' threads over the years - hardly an avalanche given the huge number of sellers on ebay. Perhaps just being a bit more realistic rather than scaremongering would help.

If a buyer gets really grumpy about not being able to return an item, just accept the return. Job done without all this drama.

ballisticbrian

hardly an avalanche given the huge number of sellers on ebay.

But the huge numbers on eBay aren't necessarily trying to dodge the tax man are they, and I don't think the number of times things get discussed on this forum are a truly representative basis on which to make a judgement. There are many people who get caught by the tax man, the last place they would want to discuss it is on here.

lofielectronic

Would I be right in thinking just the same rules apply to Car Boot sales as do eBay?

I've never seen a story in the press about this issue with those however stories about this and eBay come up every couple of months.

RFW

forgotmyname wrote: »

Yeah but how many small businesses can afford to sell at a loss for any length of time?

Especially ones being legit and declaring their earnings properly, too much smoke and mirrors with larger companies.

How can a company that makes zero profit for xx years afford to pay its staff year after year and pay those high up huge bonuses for making a loss? Get a free factory and tax breaks to employ the local people until the perks dry up when you move elsewhere?

A bit off topic, unless the OPs rivalling the large companies out there

Some companies will pay staff well and show a loss, it's a good grounding for a business to have staff invested in it and stay loyal. The media tends to focus on companies trying to shaft employees and with directors raking in big bonuses. Thankfully they aren't all like that.

I would have thought that we largely agree with each other. Not comparing big and small companies but someone selling out of their house could well show a loss for a good few years if they did their accounts correctly. Especially if they have a part or full-time job.
If you do run a business from home then you're probably subsidising yourself for rent, utilities, etc.
Most business advisers will tell anyone starting a business that they shouldn't expect much, or any, profits in the first couple of years.

soolin

lofielectronic wrote: »

Would I be right in thinking just the same rules apply to Car Boot sales as do eBay?

I've never seen a story in the press about this issue with those however stories about this and eBay come up every couple of months.

Several of my local car boots have been targeted, not only by HMRC but surprisingly by DWP as well.

I used to do voluntary work in an unofficial capacity and most of it was connected with eBay or car boot sellers who were 'caught' but virtually all of them by DWP and nearly all of them turned in by family or friends. In some cases it became quite serious and was passed on to more official bodies to help, especially with interviews under caution.

RFW

soolin wrote: »

Several of my local car boots have been targeted, not only by HMRC but surprisingly by DWP as well.

I used to do voluntary work in an unofficial capacity and most of it was connected with eBay or car boot sellers who were 'caught' but virtually all of them by DWP and nearly all of them turned in by family or friends. In some cases it became quite serious and was passed on to more official bodies to help, especially with interviews under caution.

It makes more sense to me that it would be the DWP that catches them. There's little money in it for HMRC, I'd imagine the over time paid to staff for working on a Sunday would outweigh any potential returns they get.
I saw a Trading Standards raid on a car boot last time I went to one.