# The Taxman cometh



## Cypher871 (Aug 2, 2009)

Just when you thought it couldn't get any worse in the UK it would seem the taxman is ready to rumble prolific Ebayers. For those of you that sell on Ebay the new rulings would appear that if you sell over 100 items per year OR make more than £2000 per year you will be taxed.

Unfair to be sure as most of the items sold on Ebay by private buyers have already had tax paid on them BUT, the tax office are seeing this as an income stream just like any other and it will count towards your annual tax contributions.

For the average Joe this won't have much impact but for Bitz breakers it could have serious repercussions.


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## Grenth (Mar 21, 2011)

Basically they are taxing your income, just like if you werre earning the money on a paycheck.


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## Khargoth (Aug 5, 2010)

Ouch! I support the idea of taxing people who make significant income, but the 100 items limit is very much a dick move. I wonder if that means you're taxed for everything that passes that 2k/100 item limit, or whether it's retroactive?


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## Schizofen (Mar 11, 2009)

If you're making money by breaking up kits and reselling on Ebay and not declaring it for tax purposes then you're already breaking the law, so this won't affect those people.


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## bitsandkits (Mar 18, 2008)

the people its mainly gonna effect are those who decide to have a clear out of personal stuff, loads of people sell off old clothes or cd's/dvd/books and such, if you de-junk your house a few times a year, a 100 sales isnt hard to reach, plus if people are not sure of the rules they will just stop selling and throw the stuff out or send it to charity, alot of people dont even do it for the cash, they see it it as a way of recycling, plus quite a few things loose money when the ebay fees,paypal fees and postage is accounted for.


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## slaaneshy (Feb 20, 2008)

Well if you want a country where every useless pleb gets benefits, 'free' health care and pointless wars in shitty arsehole areas of the world that no-one gives a fuck about - you got to pay for it somehow!


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## Grins1878 (May 10, 2010)

Looks like it's just going to be a few choice items for sale from me in the future then. Ass hats. Everything I sell on there has alreaady had tax paid on it when I bought it using taxed money...

Could be worse I guess, I could live somewhere shittier than here...


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## Vaz (Mar 19, 2008)

It'll possibly bring more sales forums though. Instead of buying 7-10 items seperately, you "purchase" those items through discussions on a forum, and then Ebay/Paypal.

100 items though is pretty shit. I sell about 30-40 things a month through military forums, and if that went through Ebay, shittt.


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## Achaylus72 (Apr 30, 2011)

This is called double dipping, meaning you are paying tax on items that have already being previously taxed on.

Luckily in Australia it is illegal for the Government to double dip.


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## Aramoro (Oct 7, 2009)

It's not really double dipping, it's taxing income for selling goods exactly as a shop would. If you set up a shop selling goods you would pay tax, it's the same here you're setting up a virtual shop selling items.


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## Achaylus72 (Apr 30, 2011)

Aramoro said:


> It's not really double dipping, it's taxing income for selling goods exactly as a shop would. If you set up a shop selling goods you would pay tax, it's the same here you're setting up a virtual shop selling items.


I can only go on as speaking as an Australian, this is not the same, if these individuals have the same as ABN's Australian Business Numbers as i have one, and these individuals are registered with ACN's Australian Company Numbers and are registered on the GST (Goods and Services Tax) register and have either online and/or Bricks and Mortar shopfronts, the Australian Government can't do squat, these are private sellers, they are not required to fill in Business Tax Packs.

The only thing the Australian Government can do if any of these individuals are in reciept of a Government benefit and not declaring (i do) their additional incomes, the Australian Government can cut folks off the benefits for undeclared incomes.


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## EmbraCraig (Jan 19, 2009)

Aramoro said:


> It's not really double dipping, it's taxing income for selling goods exactly as a shop would. If you set up a shop selling goods you would pay tax, it's the same here you're setting up a virtual shop selling items.


Exactly - you're not paying VAT on them (the tax paid when you originally bought the item), you're paying Income Tax on the income from them. Which you should have already been doing if you were making more than the threshold (can't remember what the limit currently is - there is a figure you can earn tax free from an extra income from a home business of one or two thousand pounds a year).

I'd like to see the source of the story though - I think there's a strong chance it actually says anyone selling more than 100 items a year will be assessed to see if they *should* be paying tax, not that they'll be charged right there and then. After all, you should only be paying tax on the profits from selling them...

EDIT - to show this isn't anything new, here's a BBC story from 2007 talking about IR pointing out that some people should be paying taxes... plus Ebay mentions it on their Tax FAQ page.


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## exsulis (Jul 17, 2008)

It is the same thing in the US. Granted, they don't have the silly $2,000 or 100 items limit. 

Per the US tax law, if you buy something and then resell it for profit then it is taxable on your income tax. Reselling stuff like a garage sale that you don't want is non-taxable. It comes down to intent. It is just ridiculously hard for the US gov to prove that your e-bay page isn't cleaning house without a audit.


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## Varakir (Sep 2, 2009)

What happens if you're selling a car? Over 2k you'll get taxed?


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## darklove (May 7, 2008)

Does that mean that if you make a loss on an e-bay sale you can get a rebate against your income tax?


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## Marneus Calgar (Dec 5, 2007)

Use different accounts...?


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## imm0rtal reaper (Jul 15, 2008)

Just use the forums :biggrin:


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## increaso (Jun 5, 2010)

It's clear that they are after businesses that are making money via ebay and not paying the tax on their income.

If you sell your crap on ebay they might technically be able to 'get' you, but they are not after you.


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## Chimaera (Feb 1, 2010)

I take it the 12 month period is a UK fiscal year?

Like B&K said. It's a bit crap for those having a house clear out. Most times I have bought the items brand new and paid tax already and they normally sell for less than I paid on E-bay. It's a piss take in my opinion. How can it be fair to be taxed twice? Then again I suppose we have to pay for the MP's expenses some how  Reading the papers it seems like they are slipping back into old habits fast i.e. why should we pay for things out of our own pockets when we can fleece the tax payer instead.



> Does that mean that if you make a loss on an e-bay sale you can get a rebate against your income tax?


That's an interesting point only the W**k*** would probably ask you to present original receipts & we all keep our receipts for stuff bought over a few years back.


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## Maidel (Jun 28, 2009)

Tbh, its something that they should have done earlier - perhaps not with the current limits they have suggested - but there are so many people on ebay making absolute fortunes (look for people with 100K+ feeback) that they are either registered as a business, or they are tax avoiding.

And anyone who is doing this and already paying VAT on items - well they dont need to worry, because if they are paying VAT they can start claiming that back againt the tax they pay (but they will have to include VAT at the other end....)


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## Cypher871 (Aug 2, 2009)

The article was actually in a recent edition of the News of the World. It falls under the Capital Gains Tax rules and is really aimed at those cottage industry types and power sellers that are not VAT registered, but, setting the threshold so low is going to impact a lot of people. The same article does also say that they don't see how they are effectively going to police this due to all the public sector lay-offs, but, they will be using Ebay's own records to sniff out the most prolific offenders.


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## Maidel (Jun 28, 2009)

Ah, that bastion of journalistic credibility that is 'the news of the world'

Obviously it's been a slow week fir premiership footballers boning each others wives.


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## Cypher871 (Aug 2, 2009)

Maidel said:


> Ah, that bastion of journalistic credibility that is 'the news of the world'
> 
> Obviously it's been a slow week fir premiership footballers boning each others wives.


Heh heh, I never said it was from an intellectual source.  I happened to be in the Parts department of one of the Jaguar dealerships I look after and they were talking about it as they have a legit Ebay business account for selling old stock.


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## Aramoro (Oct 7, 2009)

For anyone who is interested HRMC have made a handy list of examples of when you need to inform them, register for VAT or pay capital gains tax,

http://www.hmrc.gov.uk/guidance/selling/examples.htm

And the less friendly but informative. 

http://www.hmrc.gov.uk/guidance/selling/income.htm

These have always been the rules, they're just enforcing them now.


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## Maidel (Jun 28, 2009)

Cypher871 said:


> Heh heh, I never said it was from an intellectual source.  I happened to be in the Parts department of one of the Jaguar dealerships I look after and they were talking about it as they have a legit Ebay business account for selling old stock.


I'm just wondering whoes phone they tapped to get this nugget.


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## Overbear (May 10, 2011)

Don't see the problem, its easy to get around. Just set up a offshore bank, and have the funds go directly into that. No paper trail, no proof, no money for anyone to see.


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## Maidel (Jun 28, 2009)

Overbear said:


> Don't see the problem, its easy to get around. Just set up a offshore bank, and have the funds go directly into that. No paper trail, no proof, no money for anyone to see.


Oh right - and when they ask ebay for your accounts and see that you sold £20,000 worth of stuff - it doesnt matter where that account is - that was still your income.


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## Overbear (May 10, 2011)

Maidel said:


> Oh right - and when they ask ebay for your accounts and see that you sold £20,000 worth of stuff - it doesnt matter where that account is - that was still your income.


Not if that account also links to offshore. Then all you were was a "shipper" you never made a dime. You create a dummy company as a LLC, offshore, base the bank in the same place, then put yourself as CEO, and pay yourself some pittance out of the funds (say, $500 a year) plus "expenses" 

How do you think the rich get rich and stay that way? A hint, its by exploiting every loophole in the system.


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## Hammer49 (Feb 12, 2011)

Overbear this wouldnt work in the UK. As soon as you bring the income into the the UK you will be liable to pay tax on the income. 
You will never be able to use the money in the UK without paying tax on it (after allowances etc).


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## Maidel (Jun 28, 2009)

Hammer49 said:


> Overbear this wouldnt work in the UK. As soon as you bring the income into the the UK you will be liable to pay tax on the income.
> You will never be able to use the money in the UK without paying tax on it (after allowances etc).


We have a whole load of cases at the moment in the house of lords/commons with various very rich people being listed as 'non-domicile' for the purposes of tax - its very complicated - but basically it boils down to what hammer said above - they cant bring that cash into the uk without being taxed on it - so its left abroad for when they go abroad, and any money they make in the uk is then taxed as normal.


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## Overbear (May 10, 2011)

Maidel said:


> We have a whole load of cases at the moment in the house of lords/commons with various very rich people being listed as 'non-domicile' for the purposes of tax - its very complicated - but basically it boils down to what hammer said above - they cant bring that cash into the uk without being taxed on it - so its left abroad for when they go abroad, and any money they make in the uk is then taxed as normal.


So if your "company" that is outside the UK, bought items on ebay, but had them shipped to you, would that be taxable? (it ain't here in the US)


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## Maidel (Jun 28, 2009)

Overbear said:


> So if your "company" that is outside the UK, bought items on ebay, but had them shipped to you, would that be taxable? (it ain't here in the US)


But its not about 'buying' them - its about selling them.

And if you mean sell items 'offshore' and then use the same accout and 'buy' things offshore and have them shipped to you using the money made from selling stuff - then the answer to that would be 'depends'.

We each have a 'gift allowance' (I cant remember the correct word) that means we can buy stuff from abroad and have it brought into the country without incurring any costs - but if you go above that allowance then you would be forced to pay VAT on all those purchases and import taxes where applicable.

So like everything, its scale.

Ill give an example with a car - if you buy a car abroad and have it shipped here you have to pay something like 20% of its value in tax. That is, unless you have owned the item for 2 years, in which case you dont have to pay tax.


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## Overbear (May 10, 2011)

Maidel said:


> But its not about 'buying' them - its about selling them.
> 
> And if you mean sell items 'offshore' and then use the same accout and 'buy' things offshore and have them shipped to you using the money made from selling stuff - then the answer to that would be 'depends'.
> 
> ...


and I thought our tax system was nuts :headbutt:


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## Maidel (Jun 28, 2009)

Overbear said:


> and I thought our tax system was nuts :headbutt:


Well at least ours is 'less' prone to be screwed around by rich people.


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## Viscount Vash (Jan 3, 2007)

Maidel said:


> Well at least ours is 'less' prone to be screwed around by rich people.



Thats right, coz all the really rich Brits fuck off abroad to avoid paying them at all. 

Gotta love our system, I made the mistake of buying something from the states (old Epic Nids expansion) for £18, then customs decided I needed to pay £36 import tax.

I reckon you can guess how that conversation went and what the most popular word was.


I do not sell enough on Ebay to worry yet, but it was bound to happen at some point. When it does the Trading Area should get busy lol.


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## Overbear (May 10, 2011)

Maidel said:


> Well at least ours is 'less' prone to be screwed around by rich people.


Great thing about your system is, ANYONE can use the loopholes, you just have to know how the system works. 

Not that I would know anything about that, I am innocent, wasn't me, I was at a party just ask the others.:grin:


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## Maidel (Jun 28, 2009)

Viscount Vash said:


> I reckon you can guess how that conversation went and what the most popular word was.


Was it something along the lines of 'If I bend over would it make it easier?' :shok:


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## chaoz2010 (Apr 2, 2011)

slaaneshy said:


> Well if you want a country where every useless pleb gets benefits, 'free' health care and pointless wars in shitty arsehole areas of the world that no-one gives a fuck about - you got to pay for it somehow!


someone who talks more sense than all of those overpaid mps! <3


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