EBay Traders and HMRC

safariman
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safariman
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Joined: September 18th, 2010, 7:48 am

December 10th, 2015, 1:47 pm #1

Hi Guys

Not sure were to list this post but I am sure it will get moved to the correct place - sorry for putting it here

Just wondering if anyone else has received a letter this week from HMRC regarding online tradings???? No problem for us as we are all legit and everything is declared but wondering if we might now see a drop in the number of sellers online as I think the vast majority are doing this on the sly. Letter urges you to call them within 30 days to discuss and check your dealings. They are obviously getting details from EBay and other e-commerce providers.

Look forward to hearing from other sellers.

Tracitradings - The home of Discounted Trading Cards - www.tracitradings.co.uk

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BigErnst
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BigErnst
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Joined: August 7th, 2013, 3:11 pm

December 10th, 2015, 2:59 pm #2

Glad to hear eBay are taking measures and HMRC are now on the case - this will definately see a reduction in the number of online traders not registered for VAT or Corporation Tax seeing this as a quick way of earning some income.
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Zissou
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Zissou
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Joined: March 16th, 2015, 11:25 am

December 10th, 2015, 3:50 pm #3

BigErnst wrote:Glad to hear eBay are taking measures and HMRC are now on the case - this will definately see a reduction in the number of online traders not registered for VAT or Corporation Tax seeing this as a quick way of earning some income.
HMRC have been hot on e-commerce sellers since earlier this year. Not sure why you mention Corporation Tax as that would imply they've incorporated, which is anything but on the sly, and you'd have to be turning over a LOT of football cards to exceed the VAT threshold.
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MatchAttaxOutlet
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MatchAttaxOutlet
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Joined: October 2nd, 2009, 9:20 am

December 11th, 2015, 4:10 pm #4

It's not impossible Zissou, during our first year of trading (from August to April) we turned over 45k, all legit and tax paid, and at the time it think the limit was 60k, had we done the full year we may have touched the threshold.

Nice to see HMRC going to town on these guys.
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Phild
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Phild
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Joined: April 16th, 2010, 11:34 pm

December 11th, 2015, 8:20 pm #5

About time to be honest, too many avoiding tax to take themselves on a nice holiday each year.

As for the VAT its not hard to hit that threshold.

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Zissou
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Zissou
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Joined: March 16th, 2015, 11:25 am

December 11th, 2015, 9:59 pm #6

82,000 cards (at £1 each for example) in 12 months is certainly a lot for someone who is doing this part time.

You two appear to be doing this full time, so much so you've created your own site (in Phil's case at least). I'm doing it to simply recover what I spent to complete the collection, any "profit" I make purely on the cards no doubt would be wiped out once I allocate a small percentage of my internet bill, notional expenses such as use of own residence etc.

Whilst it's a new thing for HMRC, it would almost pay for them to NOT write out to sellers and instead chase them 3/4 years down the line where they're less likely to have purchase receipts. HMRC would make a decent amount on penalties, interest on top in addition to having the person pay over more tax/NIC than if they'd been advised to keep proper records.

Safariman, would you mind advising roughly how much you've put through your Ebay account that has triggered HMRC to write to you? Would be interesting to know what HMRC considers enough (turnover wise) to focus on sellers.
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Phild
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Phild
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Joined: April 16th, 2010, 11:34 pm

December 11th, 2015, 10:04 pm #7

I think there is a difference though between people like yourself who buy them, complete the set and then sell the rest to make your money back and the ones who constantly restock and purely sell to make an extra few quid every week.

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Zissou
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Zissou
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Joined: March 16th, 2015, 11:25 am

December 11th, 2015, 10:08 pm #8

Phild wrote:I think there is a difference though between people like yourself who buy them, complete the set and then sell the rest to make your money back and the ones who constantly restock and purely sell to make an extra few quid every week.
Oh certainly, but it'd be interesting to see what figure HMRC need to see before chasing the person.

We have a client who was selling some perfume as a hobby, over a few years (unbeknown to us) and HMRC hit them hard a few months ago, so it's not just card collectors they're aiming for, before any of you feel victimised!

I feel for the proper sellers, as you'll likely have to mark up to account for the tax you have to pay and if you're doing very well, VAT. If you're making enough profit to justify going Limited, then kudos to you!
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ofb1988
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ofb1988
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Joined: April 7th, 2011, 5:20 pm

December 11th, 2015, 10:25 pm #9

What is the actual limits before tax kicks in? I think I've made 3k one year then really under 1.5 the last 6 years. I only really sell off the odd card here and there and Xbox games I don't play. Tbh I thought as its like my personal things it was OK. I do have thousands of base cards that I was gonna list in smaller lots but a bit wary now lol.
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Phild
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Phild
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Joined: April 16th, 2010, 11:34 pm

December 11th, 2015, 10:29 pm #10

My tax bill for the past year was more than enough to keep them happy :crying

I think if you're doing it right as a legit trader then you have nothing to fear, they're welcome to see my books anytime. I have receipts for everything and as i'm strictly online then theres no cash payments going in and out either.

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