Declaration of Being a Sole Trader

maoboyo

Hi,

I'm very new to all of this so I hope you will bear with me. I recently (October '07) started on a regular basis trading items on ebay, although this was on an extremely casual basis at first. Although this is not my primary job (i'm a student), this enterprize has taken off recently and as a result I believe I now will probably have to pay tax on these earnings (profits have now risen above the personal tax allowance mark.

I am aware that I need prior to self-assesment to fill out a form declaring myself as self-employed, although I am also aware that this needs to be done within three months of beginning to trade. My question is at what point could it be argued that I began trading? Casual traders on ebay do not have to do this, and that was what I was for the first few months.

Any advice would be greatly appreciated.

M.

TaxGeek

As you state, if you are trading you are classed as self employed and will be liable for income tax and NIC, and must notify HMRC within 3 months of starting to trade.

It is not clear cut at what point casual selling becomes a trade, but HMRC have issued initial guidance to cover exactly the situation you describe.

http://www.hmrc.gov.uk/guidance/selling/index.htm