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When do I need to register as a business?

Discussion in 'Legal, Insurance, Employment and Health & Safety' started by Luke40885, Jan 3, 2013.

  1. Luke40885


    Dec 28, 2012
    Evening all,

    After some much needed advice please!

    I have recently started trading on eBay selling various gaming products. I probably sell around 200-300 per month making an ok profit. Not brilliant but not bad.

    My questions really are:
    When/Do I need to register a business as I am only selling via eBay?
    Do I need to pay tax ect?
    How does paying tax ect actually work when just trading on eBay?

    Sorry if the questions sound a bit 'daft' but Im really not sure on the above.
    Any advice is greatly appreciated.

    Kind Regards
  2. nwhitmore


    Oct 17, 2010
    You need to register as a business as soon as you start turning over any money - whether you're "only selling via eBay", Amazon, a market stall or wherever. You should have registered already as it sounds like your business is already established - so if it were me I'd hop straight over to the HMRC website and sign up as self employed right away. Or you might want to meet with an accountant and see whether or not it'd be beneficial to form a Limited company - if you go down that route you don't need to be self employed.

    Yes, you have to pay tax on the profits that your business makes, like everyone else does. If you register as self employed you'll only pay tax on profits over your basic personal allowance (slightly over £8,000 for most people at the time of writing).

    Paying tax and National Insurance is simple. You'll pay quarterly National Insurance (class 2) contributions, then you'll pay class 4 contributions at the same time you pay your tax bill, at the end of every year. Keep a record of your total turnover and total costs - turnover minus costs gives you a profit margin, it's on this margin that you'll pay tax and National Insurance class 4 contributions.
    Luke40885 and T D Sales like this.
  3. T D Sales

    T D Sales Banned Member

    Aug 29, 2012
    Ditto, you really should have registered before now by the sounds of it
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