{Editor’s Note: Although not related to angling, I felt that the following news release by HMRC may be of interest to many here. The fishing tackle sections of sites, such as Ebay, would indicate that many anglers do buy and sell items for profit}
A new internet-based guide, accessible via the HM Revenue & Customs (HMRC) website for people who trade online is being launched this week (5 February 2007). It outlines the rules for people who trade online for a profit, as opposed to others who are just clearing low value items from the attic.
The online trading guide can be found at: www.hmrc.gov.uk/findout . Links to the website will also be advertised as part of a publicity campaign on UK wide websites.
Online traders are considered to be self-employed if they:
• sell goods they bought with the intention of re-selling them;
• make items themselves and sell them, intending to make a profit;
• sell or buy goods on behalf of others for financial gain (on commission); and
• provide a service and receive payment in cash or in kind.
If the answer is yes to any of these, they may need to pay Income Tax, National Insurance Contributions and fill out a Self-Assessment return. They may also need to register for VAT. E-traders who are starting a new business need to let HMRC know within three months of starting trading. HMRC has made it easy to register over the phone via the Self-Employed helpline: 0845 915 4515.
If people are selling the odd item such as unwanted presents or possessions, and are not buying goods to trade for profit, they are considered to be a non-e-trader and do not have to pay Income Tax or National Insurance.
HMRC’s Director of Risk & Intelligence, Stuart Hartlib said:
“In the new guidance, there are examples to help you work out if you have to pay tax when you sell items online. You can also access information related to online trading about issues such as Capital Gains Tax and VAT.
“This site is designed to make registering and paying tax easier, so you can work out whether you are self-employed and need to file a return.â€
