Ebay sales over £1000

GadgetGuru

soolin said:

GadgetGuru said:

I've sold probably over £10k - but it's because I sold my gaming computer, and then all the external SSD drives and my action camera collection etc. So all accumulated from a lot of higher value items, even though I sold small bits and pieces as well - around 94 items over the year. Need to stop my gadget buying addiction!!

For example, one external SSD drive sold for £700 alone, the computer was £3k, other drives for around the £300-400 mark, my GoPro for £300, Insta360 X4 for £400, and the rest just smaller bits and pieces with lower values. 

While these are all personal items sold under my private eBay account, I have not completed any self assessment as none of it was purchased with the intention of selling, and none was sold at a profit either, I'm concerned if I'm contacted by HMRC since I do not have receipts for everything.....Ive never sold multiples of items, just one off items. Pretty much cleared out my whole office!
Do I need to do anything at this point?

I would do nothing as there’s no action required on your part. 

Thats reassuring. Thank you!

XzavierWalnut

Thanks for all the information. I have applied to HMRC to be a sole trader. Whether I continue to sell on line is dependant on it being worth the effort.

RFW

XzavierWalnut said:

Thanks for all the information. I have applied to HMRC to be a sole trader. Whether I continue to sell on line is dependant on it being worth the effort.

I'm assuming you do but just in case (and for anyone else) if you make to resell then you are a trader. You could be making as a hobby and occasionally clear out some items you've made to make personal space, or get fed up with items you've made, for whatever reason. That would see you as not a business. They are quite clear definitions but some people do things that make it a grey-ish area.

XzavierWalnut

I have now received a letter from HMRC to do self assessment for 2023 to 2024.
I have worked out my sales on ebay and etsy,
My confusion is over the expense section. 
1. Seems to say if you are claiming the £1k trading allowance you cannot claim expenses. (Seems odd, so maybe I have misunderstood).
2. Mentions what expenses you can claim for, but does not list charges from online platforms, postage and raw materials that I have purchased, but all online forums state these are all included.
3. Lastly, assuming any raw materials or tools are included as expenses, do I report all raw materials that I have purchased or just the amount that I have used on the sold products.? (E.G. I purchase boxes in bulk, but use them gradually over the years.

soolin

XzavierWalnut said:

I have now received a letter from HMRC to do self assessment for 2023 to 2024.
I have worked out my sales on ebay and etsy,
My confusion is over the expense section. 
1. Seems to say if you are claiming the £1k trading allowance you cannot claim expenses. (Seems odd, so maybe I have misunderstood).
2. Mentions what expenses you can claim for, but does not list charges from online platforms, postage and raw materials that I have purchased, but all online forums state these are all included.
3. Lastly, assuming any raw materials or tools are included as expenses, do I report all raw materials that I have purchased or just the amount that I have used on the sold products.? (E.G. I purchase boxes in bulk, but use them gradually over the years.

Firstly, if you are reporting for the tax year ending 5th April 2024 then you are seriously close to the time limit, as you will need to have submitted before 31st Jan 2025. However if you are only reporting for the current tax year ending 5th April 2025 you have plenty of time.

1) the trading allowance is to make things simpler, so if you entire turnover for the year is below the £1000 you don't need to declare at all. If your turnover is above £1000 but still low, or higher and your expenses are few then you can just show total income on one line (and that includes everything including postage that the buyers paid you)  and take off £1000 with no need to prepare a set of accounts, and the remaining amount will be taxable. If however your expenses are high then you can prepare proper, basic accounts. All income on one side less all expenses on the other, and the net figure is the taxable one. You obviously can't claim the simple £1000 off plus expenses, it's one or the other. 

2) You can claim for all expenses incurred as a direct result of the business, the HMRC list is not exhaustive and is just an indication. Do not overclaim, when I was working I saw people claim for daft things like the pub lunches every day  - work out what expenses have occurred directly as a result of your self employment. So postage outwards, packaging, labels, a percentage of ink used, ebay(or other) fees etc.

3) That is a slightly more difficult question as it depends on your accounts basis as there is more than one way of doing it. I use a simple cash basis so my money is recorded at the point I get it, and my expenses are incurred when I pay. You can do a different form with opening and closing stock etc - but if you are new to this yan accountant might be needed until you get your head around it. Different models suit different people and even different types of work and again a chat with an accountant might be useful - but don't let them overcomplicate things as they might just steer you away from a simple cash basis .

XzavierWalnut

soolin said:

GadgetGuru said:

I've sold probably over £10k - but it's because I sold my gaming computer, and then all the external SSD drives and my action camera collection etc. So all accumulated from a lot of higher value items, even though I sold small bits and pieces as well - around 94 items over the year. Need to stop my gadget buying addiction!!

For example, one external SSD drive sold for £700 alone, the computer was £3k, other drives for around the £300-400 mark, my GoPro for £300, Insta360 X4 for £400, and the rest just smaller bits and pieces with lower values. 

While these are all personal items sold under my private eBay account, I have not completed any self assessment as none of it was purchased with the intention of selling, and none was sold at a profit either, I'm concerned if I'm contacted by HMRC since I do not have receipts for everything.....Ive never sold multiples of items, just one off items. Pretty much cleared out my whole office!
Do I need to do anything at this point?

I would do nothing as there’s no action required on your part. 

Thank you very much, you have explained it brilliantly for me.
I only registered with HMRC this month, based on previous comment in this post. HMRC have stated I have up to April on the letter I received and it states the same online. I should get it done this weekend anyway.