PDA

View Full Version : Ebay Shop Query - Business or Personal?



CurlyFries
22-02-2008, 07:50 PM
Hello

I'd really appreciate some advice please.

For just over a year I have sold my craft items in my shop on Ebay. My crafting is my hobby as I already have a full-time job (I need to pay my mortgage!). I make salt dough items, wooden plaques and scented wax melts.

Today I have received an email from Ebay asking me to clarify whether my account is a business one or a personal one. After checking the conditions, it turns out that making items and selling them for a profit is considered a business, which fair enough, but I can go weeks without selling anything and am not exactly making much of a profit overall. If I register as a business will have to start paying VAT and will the Inland Revenue contact me?

Unfortunately I haven't kept a record of any transactions as I've never looked at my hobby as a business. I'd hate to be in a situation where I have to pay a huge fine because I can't prove what I've actually sold.

I'm really confused about what to do - do I close my shop and just try selling items individually from time to time or do I register as a business?

Sadly local craft fairs are always so expensive that I gave up selling at them and opened my Ebay shop instead. I think I opened my Ebay shop in November 2006.

Please help!


Emma

Katianne
22-02-2008, 08:36 PM
I had the same email as you today! Must say I haven't read it all yet and declared mine as a business but will do once the wine has wore off!!!

If you are selling your crafts you do need to register with the IR as self employed, no matter what you make / lose on your crafts. There are some good threads under the Tax section of the forum with lots of advice. Hope this helps!

JBJB
22-02-2008, 08:37 PM
Unfortunately, if you make any revenue from something you sell, the Inland Revenue want to know about it. (Even if they are sporadic sales) As to whether that constitutes as a business is debatable, but, personally, I would err on the side of caution and declare it as a business.

0103media
22-02-2008, 08:40 PM
If your selling some old like a old tv or sofa etc.. Then is personal..

If trying to sell things to make money and not just get rid of old stuff then its business..

JBJB
22-02-2008, 08:44 PM
If your selling some old like a old tv or sofa etc.. Then is personal..

If trying to sell things to make money and not just get rid of old stuff then its business..

But even then, I got advised by my IR that if you "make a habit" out of selling stuff like that, it can still be construed as earning revenue from it. That's why I say to err on the side of caution because who knows how the IR work?!

0103media
22-02-2008, 09:03 PM
I agree...

One or two things vs a load of things..

:D

CurlyFries
23-02-2008, 01:36 PM
Thank you to everyone who has replied. I realise that in order to keep my shop I am going to have to register it as a business account, but how do I get round the fact that I haven't got written records of my transactions?

I am now wondering whether to close my shop completely and do some more research, and then perhaps open a brand new business Ebay account in a few months time. If I did it this way then I would contact the Inland Revenue straight away for guidance.

I'm really confused!

beadsbydesign
23-02-2008, 01:40 PM
I am sure you are not the first person to be un this situation and the Inland revenue will be able to advise you.
You will be able to work out some of your history because your sales and purchases through ebay are logged. Similally if you have a paypal account you'll be able to check back.

CurlyFries
23-02-2008, 02:03 PM
Thanks - I'll spend some time this weekend checking back through PayPal to see if I can actually print off previous transactions. I thought Ebay only kept a record of things for 60 days so I will need to investigate this further. I've got until 30 March to register my shop as a Business account. Not so sure what to do about the craft parts I've bought from various suppliers as I tend to bin the invoices (oops).

I've also been reading the topics in the Tax section of this forum and have the links to the Business Link and Inland Revanue website so I'll also study these. The different topics are really helpful and a big thank you to everyone who posts the advice!

I'm very tempted to set up a website later in the year (in time for the Christmas season) and obviously this will need to be registered officially so I'm going to make sure that I research everything thoroughly.


Emma

Sparklez
23-02-2008, 04:01 PM
Sorry to hijack your thread Emma, but just to point out that the email from ebay also states that if you use your ebay account to BUY things FOR your business, such as beads, material, card, etc, you should register as a business account. I'm sure this will affect more people than just those that have an ebay shop for selling the things they make.

Carol

Katianne
23-02-2008, 04:21 PM
If you go into your selling account on Ebay, you can view and print off your ebay invoices / transactions (including sales and purchases) by selecting the required month. Mine goes back to March 2007, so yours should go back for as long as you've been buyer and selling.

JBJB
23-02-2008, 05:37 PM
Sorry to hijack your thread Emma, but just to point out that the email from ebay also states that if you use your ebay account to BUY things FOR your business, such as beads, material, card, etc, you should register as a business account. I'm sure this will affect more people than just those that have an ebay shop for selling the things they make.

Carol

I didn't know that, thanks for that.

I have a separate buying account on ebay so I shall have to register that.

Shipbuilder
12-03-2008, 01:20 PM
Hi Emma,
All the above is true, but in addition to this, you should be aware that as soon as you register as a business on Ebay, you will be required to display your name & address on your listings for all to see! A P.O. box number is not acceptable! A lot of people, including myself, are not happy about displaying full name & address on the internet, although I don't mind buyers getting the information as soon as the auction is over & they have won an item. This has effectively put an end to me selling my crafts on Ebay, & even my own website as the same rules apply.

Incidentally, it is very easy to make your own free "blog" type website. If you look at mine (Via my Profile), you will see a box at the top right that allows people to make their own blogs. That is how I got into it. A friend directed me to his blog & I followed the instructions & had a blog up & running within 15 minutes.

Bob

newcrafter24
12-03-2008, 02:18 PM
Shipbuilder,

I am curious to know out of interest why you have stopped selling items on your own website because you have to display your address details on it.

Have you had bad experience? I know some people are worried that if a customer sees an address, they might turn up at the house unannounced expecting to see a shop.

ethel&edna
12-03-2008, 02:27 PM
Hi Emma
With ref to the idea of setting up your own blog/website. There is a link on my blog to Feeling Stitchy who has a craft blog school. This is FAB as it shows you step by step how to create a blog for free and how to get the best amount of traffic passing through it.
I've only just found it and started looking through it myself but it seems really helpful and (more importantly for me!) easy to understand.

Good luck with it all.
:0)

Shipbuilder
12-03-2008, 07:11 PM
Newcrafter24
Hello,
No, I have not had any bad experiences. It is simply that for ages the UK Government has been impressing on us not to make known on the internet anything more than is necessary. Now (at the command of Europe, it seems), they are more-or-less demanding it! Putting name & address on website or selling site may attract any number of undesirables who are just "looking for something." If a website is updated regularly & then suddenly stops unpdating (gone on holiday). It is something of an advert to "come & get it it!"

For lower value items, it probably wouldn't matter, but anyone who does have a website is, at the very least, advertising the fact that the have a computer!

This is causing major concerns to a lot of Ebay traders who (quite correctly in my opinion) think that one shouldn't be required by (EEC) law to disclose one's address to anyone except the buyer.

As long as one declares everything & pays tax accordingly, what is the problem? It is just another loss of those freedoms that we once took for granted in the UK. I am NOT a political activist, but I would rather go out of business than Kow Tow to these petty rules!

Best wishes
Bob

newcrafter24
12-03-2008, 10:03 PM
Bob,

interesting comments espescially about some less favourables perhaps noticing that you site is not being update on a daily basis i.e. gone on holiday - never though of that one!

nattynetty
12-03-2008, 11:15 PM
Personally I don't have a problem putting my address on my site, as Mr M has pointed out in previous posts if you have a website your name and address is available anyway on the net to anyone who knows where to look. Also, I really don't worry about undesirables clocking that I'm on holiday and robbing my house - what are the chances someone local enough with those tendencies is checking my site at that particular week? I suspect you're far more vunerable from the local thief who watches your curtains and lights to see if the house is empty.

Please don't give up on making and selling your crafts due to this legislation that would be such a shame - it's been put in place to protect the buyer which can only be a good thing, I know personally I never buy from a site without a physical address as it's so easy for someone dodgy to set up a site and do a runner with your money and I see it as added protection.

Shipbuilder
13-03-2008, 07:40 AM
Hi Nattynetty,
Thanks for further comments. I didn't know one could find the address of websites if one looked, but I wonder why that doesn't satisfy the law even though it is not common knowledge! I have never minded potential clients getting my name & address when they have first made an enquiry, but still feel uneasy about displaying it all the time on the internet. I also wonder if it increases Junk Mail? Some time ago when my book was published, a newspaper put my e-mail address on the web as a Contact. My Junk Mail shot up overnight from one or two a week to two hundred or more. Even after I had the e-mail removed it did not go down & now averages at about 400 a week! Ebay have not enforced it yet, but it is only weeks off & it will be interesting to see what happens. I also notice that if anyone does register as a business on Ebay, they have to provide estimated listings & sales. I have not stopped building model ships, but I am now relying on satisfied customers coming back for more. Perhaps I am using it as an excuse to slow down a bit because I am certainly enjoying the extra leisure without any pressure to finish anything by a certain time.
Bob

ladyluckjewellery
13-03-2008, 12:04 PM
Hi Bob,

I think one way to stop (or at least reduce) the chances of 'spammers' picking up your address with their automatic softward is the write your address into a paint or picture file, and then upload it to your website / ebay listing as a picture. Their software won't be able to pick it up then.

Also, if I have understood this correclty, on ebay, you won't need to show your address on each listing, provided you have a 'me' page with your address on. I'm happy to be corrected on this one if I'm wrong though :)

Claire

Shipbuilder
13-03-2008, 12:13 PM
Hi Claire,
You are quite right, it can be contained on the ME page, but I am not really keen on that either. On my own website, I do have my e-mail on one image & it does seem to limit the SPAM for that particular e-mail address. At the moment, I am taking things easy & not doing much work. I think I will wait to see what happens when Ebay start to enforce it. Looking at the rules, they do protect the buyer very much, but there seems to be no protection whatsoever for sellers.
Bob

CurlyFries
14-03-2008, 06:19 PM
Hi Emma
With ref to the idea of setting up your own blog/website. There is a link on my blog to Feeling Stitchy who has a craft blog school. This is FAB as it shows you step by step how to create a blog for free and how to get the best amount of traffic passing through it.
I've only just found it and started looking through it myself but it seems really helpful and (more importantly for me!) easy to understand.

Good luck with it all.
:0)


Hello, thanks for the advice! I've just had a quick peek and have saved the link for the Feeling Stitchy craft blog school. I plan to have a look at this in more depth on Sunday.


Emma