HMRC DONT BELIEVE WHAT THE MEDIA AND SOME PEOPLE ARE SAYING

[jackstackcornwall]

some media outlets and miss informed people are spreading the word that the Tax man is after you ,no they are not, scare mongering is doing the job it self ,its nothing to worry about , the tax people only know what you tell them and as long as you are an honest seller and do your tax return from the details on your ebay then you have nothing to worry about  the fear is far worse than the truth 

[technthread]

It is rife on Vinted. 

I think many sellers justify it to themselves by saying well I submit SA Tax Returns, I don't have disputes with buyers and would accept any return if asked. It's a touchy subject, it is illegal but some people have no choice but to grind it out and hustle if it means feeding their kids vs not. 

*edit just to be clear I don't trade on there. I can't wait for Vinted Pro, they need to hurry up. 

[*vyolla*]

I've seen a good few sellers who are clearly traders, they're the ones who pay for wardrobe spotlight or the ones listings lots of fake branded jewellery, but you're right, nothing on the eBay scale!

[litp*records]

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@technthread wrote:

It is rife on Vinted. 

I think many sellers justify it to themselves by saying well I submit SA Tax Returns, I don't have disputes with buyers and would accept any return if asked. It's a touchy subject, it is illegal but some people have no choice but to grind it out and hustle if it means feeding their kids vs not. 

*edit just to be clear I don't trade on there. I can't wait for Vinted Pro, they need to hurry up. 

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Yeah... I wonder if Vinted Pro will mean a 2 tiered fee structure like on here, will they police it, and will the problem just move from here to there? Will be interesting to see.  They don't even have a forum anymore as they shut it down.  Faster way to sell stuff though!

[technthread]

Maybe they will charge a shop fee like eBay. 

I also wonder if the postage rates will change for business sellers too as they are incredibly low for Evri, InPost and Yodel. Plus they all turn a blind eye to overweight parcels, I have bought a lot where the seller used small parcel for a 5kg item and it never gets pulled.

[jow1995]

Thanks for sharing, eBAY will probably reluctantly go down the same road knowing they are going to loose many sellers. 

[sheridan87]

Exactly. I work for a living and pay tax. Everything I sell has been accumulated over many years after I have paid tax. Over recent years I have been downsizing by selling off my stuff on eBay and by and large have enjoyed doing so. Now though the enjoyment and time spent doing so is disappearing due to increased eBay fees and now this threat of being taxed for selling stuff I already accumulated after paying tax. There's little point in selling football programmes for £1 if it's going to accrue pennies. Seriously thinking of sacking it off. I'd rather give it to charity.

[*vyolla*]

You may as well just wait and see what happens as you've gone way over 30 sold items since 1st January so it will be interesting to see how HMRC view somebody selling off their collection. 

[norrin-rad]

40% earnings on tax, 20% capital gains + eBay fees, what does that actually leave you with? 

the question for most will be is it I even worth doing? 

[*vyolla*]

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@norrin-rad wrote:

40% earnings on tax, 20% capital gains + eBay fees, what does that actually leave you with? 

the question for most will be is it I even worth doing? 

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That would be for a seller to decide, I guess.  To some the extra income that eBay selling brings is most welcome, plus to be in the 40% tax bracket someone would need to be earning over  £50,271. This may be from another full time job, eBay or a combination of both. They would be taxed 40% on earnings over the £50,271, not the full amount. 

It would be unusual for an item sold on eBay to be subject to Capital Gains tax:

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

[wiltshire-stamps-and-coins]

I think its the best thing to happen for years. I know lots of people who make good money from eBay but don't declare a penny to the tax man, which annoys the hell out of me. Even tho my sells are hobby related I declare every penny and have done tax returns for years. 

[thetimetower]

Have to agree. Not just with ebay but for the gig industry as a whole. I do delivery work and it's never been a level playing field when u got guys not paying any tax and renting out accounts etc. Now if you want to be a part of the self employment sector, u have to be strategic. For me the best part of  the changes is there's less people selling the same products as me for a loss because they dont have any tax deductions.

[forshplan]

But what about older people selling off their collections, then their children won't have the bother after they die ?  Do they  acrially trust the new HMRC to be fair and take their word that they'e not dealers.  I see your point, but I was self employed until I retired and although I found the Tax Office pretty fair when you were straight with them,  I wan't terribly impressed with some of the VAT staff on the other hand, who could act like schoolyard bullies and in one case purposely set you up for their own self advancement.

[thetimetower]

Yeh I know what u mean but the only answer I have is that nothing is fair all the time for everyone. Death and Inheritance tax are such a huge scam and the media are complicit in scandalising things. I  remember the front page article on Bruce Forsyth "left nothing for his kids"....course he didn't. He was smart and knew if he left it to his partner, the government wouldnt swipe it. The problem is that if you give people some rope they want the whole reel. Course it all is pure hypocrisy anyway when i douibt half the politicians have paid 1/3 the tax they are meant to.

[nigel_paul_wright7557]

If your trading as a business then the tax man is always after you.

Failing to submit accounts every year could see you heavily fined or end up in prison.

[forshplan]

Hi Nigel.
If you look at my eBay feedback you will see that most of my feedback is
for stuff I collect. Prior to that I have sold off bits and pieces my Mum
collected over the years.and was too varied to put in the local
auctioneers hands. Having been self employed for many years until
retirement, I've always been pretty clued up about tax and wise enough not
to risk falling foul of the odd 'bad egg'
in that organisation. Thank you for the warning which in my case is
unnecessary. Although I'm aware there are some sellers on eBay who are
taking a big risk, my point has just been made to offer comment to those
sellers who are unfamiliar with sellf employment facts of life. To
conclude, a former girlfriend from a long time ago who was an Inland
Revenue Tax Inspector, jokingly told me to never get a caravan or speed
boat if I was self employed as it made the tax people suspicious you were
on the fiddle!

[theelench]

Just my opinion but I think this marks a step change in the way that HMRC and probably all the tax departments in the OECD nations look at collecting, because for the first time they now have the technology to look at it in such detail.

I collect Art Deco, in particular glass.  I have done since before the internet and ebay were invented and my collection was based on what I could pick up locally.  Collecting a 'set' of anything involved quite a few false starts depending on luck more than planning.  Most of what I'm selling today is the result of sometimes indiscriminate buying, in the hope of finding more of the same over time.  A lot of it was stored during the 80's during a rushed house move and not retrieved until my fathers death and the sale of his house where it was stored.

My collection has never been static and I doubt many others are.  Even today and with ebay to help, getting a matched pair of (say) vases can take several attempts, with those not quite right being sold when a better match is found.  Is that Trading ?  It might go on over several years, little or no profit might be involved as the sale of one is used to pay for another.  The intention is not to pocket the 'profit' but to get a perfect match.  To me collecting is an on-going process, not simply a series of one-off purchases.   

I'm sure HMRC will at first be primarily catching businesses blatantly selling as private sellers to evade tax.  But as HMRC questions collectors about the possibility of them trading and light is shone on 'grey' areas, I've no doubt that their 'tests' like the Badges Of Trade will be updated and become more stringent.  In a few years time any collecting will have to have its 'paper-trail' and without it, it will be automatically assumed to be Trading. 

At my age I'm making an effort to unload far too much 'stuff' that I've collected to save my heirs the trouble of doing so.  Can I prove that's what I'm doing  --  of course I can't.  I have no 40 year old receipts or price tags.  The goal posts have just been moved regarding the sale of personal property and knowing how desperate governments are for tax revenue, they haven't stopped moving with this measure.  They've only just started IMO.

[brindsey]

Totally agree.  Mine's hobby related too. 

Now 77, and as an ex needlework teacher, I turned my hand to repairing/restoring upper high street fashion when I retired.  Having to pace myself a little these days, but eBay and the garden keep me going.

I too declare every penny, have done tax returns for years, and am overjoyed at this new HMRC development.  Can't wait for the hiatus and shenanigans when the requests for the NINO's finally go out (and they'll leave it as late as they dare).

[papso22]

It is in Ebay's financial interest to leave it as late as possible.   What they should have is a rolling programme where they ask each seller who reaches one of the thresholds for the required information. 

However, given that not providing it should result in a suspension of selling, the longer Ebay leaves it the more fees they get from potential illegal activity.

[carbtec]

No one who earns money should be fooled into thinking that HMRC aren't after them. Simply because this is what they do, or at least a large chunk of it. As an organisation it is massive, well funded & with 1000's of employee's, most of which are very well qualified, very well trained & in it for their whole careers. They have systems & practices that throw up 1000's of people of interest every hour & sometimes they discover new ways to ID them faster & more accurately.

They can be quite overwhelmed at times & often suffer being poorly directed, but don't ever take them for fools & don't ever think that if you come up on their radar they will automatically move onto some other bigger fish. You can convince yourself, you can convince anyone you like that YOU are not trading & YOU don't need to declare anything, but ultimately it is HMRC YOU have to convince. When they come they come & hear me now an audit from the income tax folks is by far more preferable than an audit from the customs & excise side . . . .

[theelench]

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@papso22 wrote:

It is in Ebay's financial interest to leave it as late as possible.   What they should have is a rolling programme where they ask each seller who reaches one of the thresholds for the required information. 

However, given that not providing it should result in a suspension of selling, the longer Ebay leaves it the more fees they get from potential illegal activity.

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Also they will, without doubt, have worked out that potentially they will loose a hell of a lot more in fees from private sellers, selling completely legally , when they do get around to demanding NINO's.

All those lovely sellers that ebay recognises "buy twice as much on ebay as buyers who don't sell on ebay".

I wonder if this is shaping-up to be as big a blow to business sellers as MP was ?