Doubts about business residence when registering for Self Assessment on previous work

JacobEdgar

Hello, I've spent the last year living and working in the UK, selling items through eBay. Now I am abroad, in my family's home in the EU, deciding whether I will settle abroad or not.

I didn't register for self employment, as I read you could do it until 5th October, and all the same I was under the threshold for tax.

The question is that now I am being asked where I live and where the business is situated. 

I have for the moment selected I live in my uncle's house, as I go there from time to time, and as I was renting before, the only place I could select as an address. As I am not registered as resident in the EU, and all the same just spent about a month here, I cannot say otherwise I suppose.

The question is when they ask business is situated. The business is no longer operating, so what should I do? give the old address of the place I was renting no matter I don't have any access to the letters they might send there? is there anyway of registering a past work, or indicate that they send no postal communications there?

I could also select my uncle's house, but it really isn't my business address, and wouldn't want to land him into any trouble or unnecessary fuss.

What should I do?

Hoenir

Who is asking? 

What was your Ebay turnover/profit? 

mybestattempt

Why not just tell the truth, the business isn't currently situated anywhere as you've ceased trading and also make sure to tell HMRC your current address so they can contact you if they need to.

If the online form doesn't fit your scenario then send HMRC a letter giving them your current address, the precise dates you were in the UK and the period the business traded and how much profit you made.

Send it as soon as you can, keep a copy and proof of postage. 

It maybe months before you get a response but you'll have done all you need to.

JacobEdgar

According to the HMRC website, one has to register if income has been more than 1000GBP; even if you don't have to pay tax. Absurd, but then most laws are nowadays.

eBay turnover was about 3000 GBP, and PayPal about 1000 GBP.

The online form doesn't seem to conform, but sending a letter might be very slow. Maybe I will try to fill it in showing the old address, and if I see a place for notes then add something there.

Hoenir

JacobEdgar said:

According to the HMRC website, one has to register if income has been more than 1000GBP; even if you don't have to pay tax. Absurd, but then most laws are nowadays.

Onus has always been on the taxpayer to declare their income in accordance with the current tax legislation. If one doesn't. Then besides the unpaid tax, penalties and interest can be imposed. Those that knowingly act outside the law suffer the consequences.  Pointless grumbling about absurdity.  That's life.

Marcon

JacobEdgar said:

According to the HMRC website, one has to register if income has been more than 1000GBP; even if you don't have to pay tax. Absurd, but then most laws are nowadays.

eBay turnover was about 3000 GBP, and PayPal about 1000 GBP.

The online form doesn't seem to conform, but sending a letter might be very slow. Maybe I will try to fill it in showing the old address, and if I see a place for notes then add something there.

Turnover isn't profit - how much profit did you make?

JacobEdgar

Hoenir, yes, but it could be made a thousand million times easier. Sort of like just add 10 % more of VAT to everything and be done with more taxes, or just a simple registration, through a system that automatically scans sales from eBay or PayPal. Heck, HMRC could even just be plugged onto eBay and be done with it. I've lost countless hours researching how I must register, and going through all the loops of the system.

Marcon, expenses must have been about max. 15 % of the total, so profits still well above 1000 GBP.

I've researched a bit more and some companies offer "virtual" business addresses, that they receive all mail and redirect it to you. So from this I take it it is basically a postal address, needed for notification, so I guess my uncle's address will do just fine, the address doesn't need to be a place ready to make business from, nor be a extra on local council tax nor any other similar nasty thing.

Hoenir

JacobEdgar said:

Hoenir, yes, but it could be made a thousand million times easier. Sort of like just add 10 % more of VAT to everything and be done with more taxes, or just a simple registration, through a system that automatically scans sales from eBay or PayPal. Heck, HMRC could even just be plugged onto eBay and be done with it. I've lost countless hours researching how I must register, and going through all the loops of the system.

That's why many people are happy to remain employees and never run a business. Requires a huge amount of time and effort. Alternatively seeking advice from professional people at the outset. 

mybestattempt

JacobEdgar said:

I've researched a bit more and some companies offer "virtual" business addresses, that they receive all mail and redirect it to you. So from this I take it it is basically a postal address, needed for notification, so I guess my uncle's address will do just fine, the address doesn't need to be a place ready to make business from, nor be a extra on local council tax nor any other similar nasty thing.

I'm assuming your dilemma about your home address and business address is to do with completing a CWF1 form to register for self assessment.

If so, the problem you now have is that you didn't complete that form when you started the business (you should have done it within 3 months) and you've decided to lie about both where you currently live and the business address.

If you do that you will then, immediately afterwards, have an obligation to inform HMRC that the business has ceased and where you actually live.

The 5th October 2024 deadline is the legal requirement is to notify HMRC, (if they haven't already sent you a notice to file a self assessment return for 2023/24), that you have tax to pay for 2023/24.

That is why I suggested a letter now with all the information they need to register you for self assessment, set up a correct self assessment record and they know there may be tax to pay.

If there's no tax to pay does it matter when HMRC get round to sending you notice to file a self assessment return for 2023/24 in response to a letter?

What does matter is giving full and correct information to HMRC at the time required. You didn't do that so why compound the problem for yourself?

JacobEdgar

No, you are getting it wrong. I am not setting up a company, I am just registering as a sole trader. I have looked and read all the info on gov.uk, and it just says I need to register before 5th October, and I could do so when I started, but no obligations to do it at any other time than before the 5th of October.

I am not officially resident where I am in the EU now, and I spent nearly all the tax year in UK; and as I stayed with my uncle on several occasions during the year I believe it is closest thing I have to an official address. If I decide not to return to the UK then I'll inform I close the business activity.

I will try and do everything online, as supposedly one can nowadays.

From experience I usually know that trying to confusingly explain reality to fit bureaucracy terms when there is no real point is just bad for both parties.

mybestattempt

I haven't thought for one moment you are trying to set up a limited company!

From what you have said I understand that you were a sole trader in the UK, that activity/business has ceased, you now live outside the UK but visit your uncle in the UK from time to time.

In your opening post you asked if there was another way to notify HMRC about your previous sole trader business as the questions on the online form did not fit your present circumstances.

I have attempted to tell you there is another way.

On the basis of my experience and knowledge of UK tax legislation I have suggested you provide, by letter, all the correct information HMRC need to know before 5th October 2024 so they can get you onto the self assessment system and deal with your UK tax affairs.

If you tell the truth in a letter why would HMRC be confused? Completing a form with incorrect information and then to delay correcting it is far more likely to cause confusion and difficulties for you further down the line.

I don't have anything more to add other than there is legislation for national insurance purposes which requires a self employed person to notify HMRC immediately when they start to be self employed and immediately when they cease to be self employed.