Universal Credit While Ebay Selling

beatthebookienet

I am on universal credit unemployed and at the same time I have a hobby which is collecting a certain type of collectable, which I also have a personal collection of. I have been buying and selling these frequently during the last month and sometimes I make a profit from this. As far as I have researched, my situation would be a grey area because some of my ebay sales are items which I bought years ago before I was on UC and others are recent ones from joblots (where I have saved some and resold others). The items between my personal collection and purchases/sales are constantly mixed up. Since I sometimes sell off items which I have had long term from my personal collection, my ebay sales turnover will look quite high and be above the £1000 trading allowance. The actual profit of reselling short-term, I would estimate at anything up to £50 a week (but more likely half of that most of the time).

Obviously I wouldn't be able to make anywhere near a living from this or meet the income threshold to affect my UC. Does anyone know if I am fine to keep doing this whilst getting UC or would I need to register as self-employed? If this is the case then do I fit into the self-employed category meaning I no longer have to apply for jobs? I would not meet the minimum income floor level but I have heard in some cases like now or for the first year you don't have to meet it?

I do have a long-term goal I am working towards but for now all I have is UC and ebay sales to scrape by. Depending on where I stand it may not be worthwhile for me to participate on ebay if this means that on top of having my long-term goal to work towards, I will have 35 hours per week of work searching and appointments, and lot of extra work to make a few extra quid a day on ebay.

Spoonie_Turtle

beatthebookienet said:

I am on universal credit unemployed and at the same time I have a hobby which is collecting a certain type of collectable, which I also have a personal collection of. I have been buying and selling these frequently during the last month and sometimes I make a profit from this. As far as I have researched, my situation would be a grey area because some of my ebay sales are items which I bought years ago before I was on UC and others are recent ones from joblots (where I have saved some and resold others). The items between my personal collection and purchases/sales are constantly mixed up. Since I sometimes sell off items which I have had long term from my personal collection, my ebay sales turnover will look quite high and be above the £1000 trading allowance. The actual profit of reselling short-term, I would estimate at anything up to £50 a week (but more likely half of that most of the time).

Obviously I wouldn't be able to make anywhere near a living from this or meet the income threshold to affect my UC. Does anyone know if I am fine to keep doing this whilst getting UC or would I need to register as self-employed? If this is the case then do I fit into the self-employed category meaning I no longer have to apply for jobs? I would not meet the minimum income floor level but I have heard in some cases like now or for the first year you don't have to meet it?

I do have a long-term goal I am working towards but for now all I have is UC and ebay sales to scrape by. Depending on where I stand it may not be worthwhile for me to participate on ebay if this means that on top of having my long-term goal to work towards, I will have 35 hours per week of work searching and appointments, and lot of extra work to make a few extra quid a day on ebay.

A very grey area indeed.

You could look at it 2 ways:
You are collecting, buying job lots for specific items for your collection and selling unwanted items, or
You're buying items to sell for a profit and keeping the ones you like.
(Obviously selling off items from your existing collection is different.) Only you honestly know which it is. If you've kept good records of what you've purchased, that may help you work out where you are and exactly what's what.

To be classed as gainfully self-employed for UC and not have work search requirements is explained here https://revenuebenefits.org.uk/universal-credit/guidance/entitlement-to-uc/self-employment/gainful-self-employment

It is a double-edged sword because if you are classed as GSE you won't have work search requirements, but after 12 months you will have the minimum income floor imposed - and if you stop being classed as GSE the MIF will no longer apply, but you won't get that start-up period again if you later decide to make a proper go of it. You'll only get another start-up period if it's for something different and 5 years or more after your first attempt.

If you are trading, the HMRC threshold is when you have to register (possibly for self-assessment, I'm not sure) but you won't pay tax until your taxable income exceeds the personal allowance of whatever it is, ~£12000?

In theory you could keep it as a hobby, something on the side, but you would still have to look for work once the temporary suspension of such requirements ends. Actively seeking other work would be a factor that shows that trading is on the side and not your main occupation.

You may do well to ask on the eBay board what others do if they have mixed personal and business sales.

[Deleted User]

There’s a similar discussion on the eBay forum about this sort of area. 

As explained over there, if you are buying to then sell on, you are classed as a trader. 

Anything over the £1000 trading allowance should be reported via a tax return, however your unlikely to pay any tax on it. 

Icequeen1

MarkN88 said:

There’s a similar discussion on the eBay forum about this sort of area. 

As explained over there, if you are buying to then sell on, you are classed as a trader. 

Anything over the £1000 trading allowance should be reported via a tax return, however your unlikely to pay any tax on it. 

And the trading allowance doesn't apply to UC - so you would need to declare all self-employed earnings for UC purposes. 

beatthebookienet

Seems like more effort than it's worth for the sake of £10 or £20 a week profit that needs to be worked out exactly and declared so I would be better off just stopping. It would only take one ebay transaction to go wrong for me to lose weeks of profit after it's already been declared anyway