|Marie Stokes||18/12/2019 14:50:07|
|2 forum posts|
I've been making some garden sculptures and benches and a lot of my friends have asked to buy them or suggested I start selling them. I have enough on my plate already, to be registering a business and such like, but would be happy to sell the occasional project, would keep the boyfriend happy too as would free us some space Legally do I need to declare this as income? I wouldn't be making an awful lot of profit, just recouping my material costs and time.
|Paul Bodiam||19/12/2019 16:24:55|
109 forum posts
I have considered the same issue. I make and repair stringed instruments.
At present it is a hobby (my day job in IT pays the mortgage), but I am considering developing this into a small business when I retire from swearing at computer systems.
At present, I do not "sell" any pieces. When I repair an instrument, I keep careful notes of my expenditure, and present an itemised list to the instrument's owner.
When I build an instrument for someone else, I invite the client to make a donation to a charity of my choosing instead of paying me. We agree an outline budget for materials up-front when discussing the design of the instrument and, as with repairs, I keep a detailed list of my expenditure as I go along.
I view all these repairs and builds as training projects - refining my skills with each piece of work - in readiness for turning this into a small business in the future.
|29 forum posts|
From the way your comments are phrased I guess you have spoken with a bank and the 'business' advisor; you don't need to have a business to trade – you can be 'Self Employed' and in your case, I'd say, far more beneficial. Go to a 'Craft Fair' or find a trader at a Car Boot in your locality and ask who their accountant is, you need advice from an accountant who is used to self employed. Most will give you a hours advice for free on the expectation they will get your business when you start trading.
Now you are thinking about selling your product do keep accurate records of expenditure (and income) even if you do not charge for your time. HMRC do follow Ebay and similar to find traders who may not be declaring income – records are all important.
Yes, if you are making a profit (any money's over and above the cost of materials and expences) then you have to pay income tax once you are above the tax-free threshold including any salery from your normal emplyment.
Do you presently do a tax return? If so you can add any income to that but you need to have proof of income, expenses and costs.
I strongly suggest you get some public liability insurance as part of your trading operation.
Edited By Wilf.T on 21/12/2019 12:31:29
Edited By Wilf.T on 21/12/2019 12:38:28
|Drake Frosts||28/01/2020 16:47:41|
|4 forum posts|
My friend has a hobby, he makes vintage wood cars, he recently started selling it, he did not know or he needed to pay tax, but he was very worried about it. If he began to pay taxes, he would lose money. Therefore, he simply added a percentage of tax to the price.
|John Peachey||14/04/2020 21:20:18|
|12 forum posts|
Yes you do need to declare the income.
Fines, interest and penalties for non declaration of income are to put it mildly draconian!
However there is some light. If your self employed income from your woodworking business is less than £1000, then you do not need to submit a return. The £1000 is turnover not profit. But you have to keep records to be able to demonstrate that your business turnover was not more than a £1000, and by using this exemption you are not able to claim expenses.
The HMRC website lists the penalties for late filing, but if you get picked up by one of the investigation teams the penalties can be severe. Its not worth the hassle. HMRC can go back 4, 6, or 20 years depending on how serious they regard your case - or in the worse case you can be prosecuted.
Hope that helps
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