"I am earning too much to change to a business account"

[fribblecollectables]

While visiting family, a relative asked me for advice about eBay. When I took a look at his account, I saw he had a private account but had listed around 400 items worth approximately £12,000. He bought the items specifically to resell for profit and is doing very well.

I said that he should switch to a business account, given the volume and purpose of his sales. His response? "I’m earning too much to change to a business account."

After looking at his  his sales for January so far,  he’s saved over £300 in fees by sticking with his private account.

That’s £300 extra in his pocket, and as he sees it, eBay hasn’t taken any action to enforce their own rules. From his perspective, why change something that’s working so well for him?

I declined to help him further.

[hugothecockapoo]

HI, fingers crossed your friend has being declaring all turnover and  profits earned on his tax return.. since jan 2024/25 HMRC are now receiving all private seller information on their accounts.

Even changing now to a business account will not help him for past sales as tax will be payable if he has gone over HMRC thresholds on turnover..

[plpmr]

As eBay are reporting to HMRC and if HMRC do investigate your friend then it won't be just for the year in question but for numerous years past.

[*vyolla*]

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@fribblecollectables wrote:

After looking at his  his sales for January so far,  he’s saved over £300 in fees by sticking with his private account.

That’s £300 extra in his pocket, and as he sees it, eBay hasn’t taken any action to enforce their own rules. From his perspective, why change something that’s working so well for him?

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It won't be though, because he can't offset his expenses and if he hasn't been declaring the income then when HMRC catch up they can backdate his tax bill at least 4 years here.

It's therefore likely that he'll be quids out, not in.