Private Vs Business

[badger0974]

My husband and I run a small site which some people may say is a business.  However, our products are all of low value with turnover and profits so small its barely a self funding hobby.   Since the introduction of Simple Delivery our shipping charges have risen from £1.10 to £2.72, this coupled with Protection Fee & VAT  make a £4.00 item much less desirable for our potential customers,  so demand is showing a significant downturn. 

In conclusion it seems private sellers are not wanted and our  transition to a business account is becoming unlikely.  We do really wonder about the future of eBay.

[jckl1957]

When you monetise your hobby, it becomes a business.  Business sellers have to accept returns and have to display their business details on their listings - those things are not optional.

You are complaining about BPF and Simple Delivery - neither of those things apply to properly registered business sellers.

[plpmr]

adding to the advice already given -

turnover/profit has nothing to do with it, as you are holding large stocks of brand new item for sale and as you make to sell you should be registered as a business.  

[pegr-834437]

Those some people who call it a business would be correct. The future of eBay should and hopefully will be a lot more customers getting their consumer rights and not being forced to pay a bpf when they purchase from a business who is not adhering to the law and is trading on a private account.

A simple way for you to go back to using your own postage and your customers not being incorrectly charged a buyers protection fee would be to change to a business account.

I understand why many are agaisnt the introductions but when so many are trading illegally (it is illegal to represent yourself as a private individual when you are a business) just so they do not need to pay to sell on the site I do slightly understand eBays moves. It would be 100 times better if they went after the accounts breaking the law instead of all private accounts of which majority are not doing anything wrong.

[suelel1968]

According to the opt out list

Musical Instruments & DJ Equipment (e.g. Parts & Accessories)

is exempt, so your postage should be the same. Are you sure you can't change it back? 

[*vyolla*]

I think that eBay are trying to level the playing field a little bit, and any traders using a private account who could previously easily undercut those correctly trading as a business with the same items, now find themselves unable to offer a competitive price because of the added Buyer Protection Fee and Simple Delivery. 

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[cobwebcottage]

It doesn't matter how you wish to describe it, you are running a small business (with over 600 of your decals already sold).

There are correctly registered business sellers on Ebay selling similar items to you who are paying fee's to list and sell their items and by complying with consumer laws, offering returns. Is this fair that they are competing with you, registered as a private seller? And what about your buyers who are also paying an unnecessary protection fee due to your misrepresentation?

'In conclusion it seems private sellers are not wanted '

Genuine private sellers can sell their unwanted items with no fees for the price they want but trying to make a profit on a private account, has been made more difficult. Quite rightly so.

[pegr-834437]

Thats not true, 13% v 4.5% + 70p is not a level playing field its still a massively lopsided field. Simple delivery is not some huge expense either compared to what a small business would have to charge.

[*vyolla*]

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@pegr-834437 wrote:

Thats not true, 13% v 4.5% + 70p is not a level playing field its still a massively lopsided field. Simple delivery is not some huge expense either compared to what a small business would have to charge.

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Business sellers can offset expenses, private sellers can't. 

[pegr-834437]

What expenses can a business offset that a business on a private account cant? What expenses should a genuine private seller have who are selling unwanted items? 

The simple fact is the fee's are not a level playing field, offsetting doesn't mean a business gets packaging for free they still have to pay.

[ile136yz]

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@badger0974 wrote:

My husband and I run a small site which some people may say is a business.  However, our products are all of low value with turnover and profits so small its barely a self funding hobby.   Since the introduction of Simple Delivery our shipping charges have risen from £1.10 to £2.72, this coupled with Protection Fee & VAT  make a £4.00 item much less desirable for our potential customers,  so demand is showing a significant downturn. 

In conclusion it seems private sellers are not wanted and our  transition to a business account is becoming unlikely.  We do really wonder about the future of eBay.

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For Private Sellers selling items (under £10 weight 100g).

depending on the Category used - the 'Custom' postage setting can be used for a Royal Mail Letter - the Seller arranges & pays for the postage label.  -  NB. the BSF will still be applied

[*vyolla*]

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@pegr-834437 wrote:

What expenses can a business offset that a business on a private account cant? What expenses should a genuine private seller have who are selling unwanted items? 

The simple fact is the fee's are not a level playing field, offsetting doesn't mean a business gets packaging for free they still have to pay.

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A private seller shouldn't try and claim any expenses on a tax return if they're not trading on a business account. If they're a private seller then they're not a trader and not entitled to claim. I know that many business sellers are trading on private accounts and believe that you can do this, but HMRC will soon be querying this with private sellers who claim expenses on their tax return in a new purge. 

Business sellers can offset fees and packaging costs.

[pegr-834437]

HMRC wont care 1 bit if you are registered as a private account on eBay but doing a tax return so thats null and void.

Yes you can claim back the cost but you still have to pay it, your packaging doesn't become free if you are a business. The simple maths is if you sell for £100 on a private account or £100 on a business account after postage, packaging, ebay fee's (including shop fees) you are left with more money on a private account and it is far from a level playing field. 

[*vyolla*]

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@pegr-834437 wrote:

HMRC wont care 1 bit if you are registered as a private account on eBay but doing a tax return so thats null and void.

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HMRC have now realised that private sellers have been claiming expenses when they're not technically trading. You can't state on an HMRC form that you're claiming business expenses unless you are trading as a business. If you have a private eBay account you're not trading as a business. 

There's an awful lot of money there to claim back. I do believe that new software is forthcoming. When have you known HMRC to miss a trick when there's easy money to claim back?

[thepillenwerfer]

You also can't offset business expenses against tax if you aren't making enough to pay any tax either.

The OP is certainly trading illegally but I can understand the temptation, especially when e-Bay aid and abet such practices.  However they shouldn't be complaining that Personal accounts don't suit their business model as they aren't meant for business use.  I'm also a bit surprised they haven't been hit with copyright/trade mark violations.

[pegr-834437]

Please send me a single link where HMRC have said they will check if a person is on a private account on eBay or even any hint they are going to do that? They really aren't but we are getting away from the point that you made of its a level playing field.

Please explain how 4.5% plus 75p (it may have changed so apologies) is anywhere near a level playing field when a business account gets charged between 7.2% and 13%? It comes close when its 7.2% but still not level and its certainly not level when its close to 3 times as much, then add in you have to pay to list on a business account whereas private accounts get 300 free a month so within a year can have 3600 listings. Its thats level I'd hate to see it being unfair.

[4_bathrooms]

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@thepillenwerfer wrote:

I'm also a bit surprised they haven't been hit with copyright/trade mark violations.

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The labels even show the ® registered trade mark symbol after the brand name...

@badger0974 - as well as consumer law you really need to understand trade mark law. You cannot produce those items without permission (such as a license) from the brands involved. I'm surprised they haven't issued VeRO takedown requests yet.

[*vyolla*]

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@pegr-834437 wrote:

Please send me a single link where HMRC have said they will check if a person is on a private account on eBay or even any hint they are going to do that?

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As far as I know, HMRC are not going to make any kind of announcement, why would they? There's a cash cow sitting there. 

eBay are sending details to HMRC when sales hit 30 or total sales is equal to or more than £1,740. Those details will also show whether the account is a private or business one. 

[pegr-834437]

Yes so HMRC get an email or some sort of notification saying ebayaccount3424 has sold 700 items and the name and NI is of John Smith blah blah they cross reference it and this same John Smith with the same NI has done a self assessment with the same figures minus any expenses. HMRC will go tick thats fine, they will not care a single thought that he is on a private account getting a far cheaper platform than those on a business account, why would they? He is doing a self assessment and paying his taxes.

Again though we have gone off the main claim you made that its a level playing field, it really isnt a level playing field when the figures are near 3 times as much for some business accounts to private accounts.

[*vyolla*]

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@pegr-834437 wrote:

Again though we have gone off the main claim you made that its a level playing field, it really isnt a level playing field when the figures are near 3 times as much for some business accounts to private accounts.

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I never said that. My exact words:

I think that eBay are trying to level the playing field a little bit.