What is the legality/tax implications from making money from Ebay?

What is the legality/tax implications from making money from home using Ebay for somebody in England? A bit like selling things for extra 'pocket money'. When is it termed to be a business, and then do you have to be registered to run as a business on ebay? What about the tax implications etc?

Reply to
Ned
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It's a business when you purchase items with the intention of selling them on for a profit ie "a trader". You should then declare the profit you make (after deduction of expenses incurred in the process) on your tax return. Selling off unwanted personal items is not "trading" so no tax is due.

Reply to
Adrian Boliston

There's no requirement to register as a business with anyone when operating as a sole trader. As for tax implications, it really depends on whether you make a profit.

If you're selling your personal possessions because you no longer want them, and selling them for less than you originally paid for them, there's no need to declare this to anyone. However, if you sell for more than you paid, and make a profit, the profit is potentially taxable as income and you have to declare this profit to the Inland Revenue.

Mike.

Reply to
Mike Mann

If they are not CGT exempt items and you make a profit you will be liable for CGT, but you probably won't be classed as being 'in business'

Tim

Reply to
tim

Unfortunately there is. You have 3 months to register with the IR when you start a new business. There is a 100 penalty for non compliance.

Unlikely to be income tax, unless a business. More likely to be CGT, and there is a chattels exemption of 6000.

Reply to
Doug Ramage

Sorry if I misled anyone. Is that a (fairly) new requirement? I ran a business in the early 80s and didn't reister with the Revenue. I did, though, declare the profits as income and the IR were happy.

Mike.

Reply to
Mike Mann

Not that new - over 2 years ago. :)

Reply to
Doug Ramage

"Doug Ramage" wrote

Is that strictly true? I thought you just need to tell IR when you "become self-employed".

Eg Joe starts a new business and becomes self-employed. He informs IR within 3 months. Two years later, he starts a second (new) business - either as well as continuing with the first, or instead of the first. Does he need to inform the IR *again*??

Reply to
Tim

The IR booklet says "business". However, IMHO, that is a bad piece of paraphrasing. It should mean, as you say, "self-employment". The 100 penalty relates to Class 2 NIC, and this is a flat rate; the number of trades/professions is not relevant.

So, in your example above, there should be no need to inform the IR again.

Reply to
Doug Ramage

No, what you say is correct. It is the individual that is registered as SE, it is not the specific business that is registered

tim

Reply to
tim

That's not strictly true. You only need to register when you personally *become* self-employed. If you start a business, and then another and another, you only need to register the first time, since it is yourself, not the business, that gets registered.

They will have difficulty enforcing the penalty, given that they haven't made enough of an effort to make people aware of the requirement. Contrary to popular belief, ignorance of the rule is a complete defence.

Reply to
Ronald Raygun

defence.

Since when ?

Reply to
Rhoy the Bhoy

Since forever. We can't have powers making rules willy-nilly without telling anyone about them and then going around arresting people for doing what in all honesty they can have no reason for believing might be wrong.

Reply to
Ronald Raygun

Well, obviously, as I said before, like, all credit to your logic, but at the end of the deh, what would a court say...er, seh ?

Reply to
Rhoy the Bhoy

Mens Rea is still a general principle which holds good. This means, in a nutshell, that you can only be held guilty of a wrong if you knew you were doing wrong.

Exceptions, where offences are absolute, are on the whole confined to specialist situations, such as where a licence is involved, e.g. driving. As part of the conditions of being granted a licence, you undertake to learn the rules.

And obviously everyone knows that it's illegal, say, to kill someone deliberately; you don't need to know that there's a law against it.

But if the government suddenly imposes a new requirement overnight that self employed people must register somewhere, they can't realistically punish non-compliance unless they've taken effective steps to ensure everyone to whom it applies is aware of it.

Reply to
Ronald Raygun

Everyone knows that, do they? Tell that to the policeman who shot Harry Stanley. Tell that to the British troops who were in Iraq.

It is considered to be the duty of everyone to find out about any new law that is published. You cannot give as an excuse the fact that you failed to find out, or rely on the government and/or media to acquaint you with all laws. It may be unfair, but it is the only workable way to go.

Try using as a defence the story that having lived most of your life in Holland, you had no idea that it was illegal in the UK to have sex with a 12 year old or smoke grass and see how far it gets you.

Reply to
Cynic

Presumably, Mens Rea can't be quite as general as that.

If a person did not know that murder was illegal (perhaps in a specific situation, such as dealing with an intruder), that person could kill without any intention of "doing wrong", and quite honestly believing that they had not committed any crime; but presumably the fact that they intended to kill, and that a court subsequently deemed that killing to amount to murder, then the (possibly admitted) intention to kill must also amount to the necessary Mens Rea?

pace Tony Martin?

Reply to
JPB

There are many 'absolute' offences for which Mens Rea is not necessary. In general 'theft' offences do require Mens Rea but as you say, you can be guilty of killing someone even if you had no intention to do so.

Tim

Reply to
tim

No it does not.

And the general view that ignorance of the law is no excuse *is* correct.

But what I do know ? I am only a lawyer. You can no doubt show us that I am wrong.

Reply to
Rhoy the Bhoy

Even if you had every intention of killing someone and do so there is no guarantee you'll even see the inside of a court. Especially if you're a cop and you shoot some poor sod carrying a table leg in a plastic bag.

I just like to remind the the denizens of usenet about that from time to time

Reply to
AlanG

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