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  • FIRST POST
    • Rhi97
    • By Rhi97 15th Oct 19, 6:24 PM
    • 3Posts
    • 0Thanks
    Rhi97
    Not registered as self employed
    • #1
    • 15th Oct 19, 6:24 PM
    Not registered as self employed 15th Oct 19 at 6:24 PM
    Hi, I've been running an Etsy shop for about 5 years now (and another Etsy shop for about 3 years) and I didn't realise that even though I don't earn anywhere near enough to pay tax I still need to be registered as self-employed.

    I'm just looking for some advice as to the best way to sort this out as I'm really worried there could be a big fine.

    (My parents have suggested I just register now and claim I started it up within the last few months, but I feel like lying about it might make the situation worse).
Page 2
    • Bobby_Bouche
    • By Bobby_Bouche 20th Oct 19, 12:30 PM
    • 33 Posts
    • 2 Thanks
    Bobby_Bouche
    Tax
    I thought the worst initially but when I got an accoutant it seems 2 out of my 4 years there was no tax liability.
    These forums are a great source of information and some truly knowledgable people, but no substitute for real advice from an accountant.

    Good luck.
    • unholyangel
    • By unholyangel 20th Oct 19, 1:53 PM
    • 14,092 Posts
    • 11,294 Thanks
    unholyangel
    I give up. I didn’t say there was something called chargeable gains tax. I have no idea where you got that from. By “chargeable gains” I was simply referring to capital gains in excess of the annual exempt amount.

    The paragraph you quoted referring to the “annual exempt amount “ is talking about GAINS. As in capital gains. Not income. It is not referring to the “hobby tax” allowance of £1k. The CGT equivalent of the personal allowance for income tax is called the Annual Exempt Amount. THIS is what that is being referred to which you have erroneously confused with the £1k hobby allowance.

    https://www.gov.uk/guidance/capital-gains-tax-rates-and-allowances

    If your income/taxable profits are within the personal allowance then you have no obligation to report it to HMRC.

    I ask you again, if you were obliged to notify HMRC even though you have no liability, what would the penalty be?
    Originally posted by TheCyclingProgrammer
    If you weren't saying its chargeable gains tax then why did you say:
    I suggest you read it again. The part you are quoting relating to the annual exempt amount relates to chargeable gains (CGT), not income tax and is completely irrelevant. The second paragraph you quoted is the part that relates to income tax.
    Originally posted by TheCyclingProgrammer
    CGT is capital gains tax, fair enough capital gains are chargeable gains but chargeable gains aren't necessarily capital gains.

    Again, chargeable/liable to tax doesn't mean it won't necessarily be a no net liability result. Not having earnings above your personal allowance doesn't necessarily mean there won't be tax to pay and having earnings above the personal allowance doesn't mean there will be tax to pay on it. If its not a specifically exempt amount/source then it needs reporting. The exempt amount for self employed income is £1000.

    But I'm not going to keep derailing the thread by debating the point. You've put forth your view, I've put forth mine. Anyone genuinely interested in the answer is always free to do their own research in addition to whats been provided by us.
    Money doesn't solve poverty.....it creates it.
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 20th Oct 19, 2:33 PM
    • 3,503 Posts
    • 2,114 Thanks
    TheCyclingProgrammer
    For the last time, there is no £1000 reporting limit in any legislation. It is a figment if your imagination. Income that results in no tax liability does not need to be notified to HMRC by virtue of s7(7) if the Taxes Management Act. It of course needs to be reported on a tax return if you have received a notice to file. This is not my view, it is the law.
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