Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon Jan 9 2017 11:43:00

UK Tax Authorities Crack Down on eBay Sellers

By: Ina Steiner

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The UK version of the IRS is cracking down on eBay and Etsy sellers and participants in sites like AirBnB, according to the Daily Mail. They have until the end of the month to declare their earnings to HMRC - otherwise they face having to pay a 100-pound fine.

Beginning April, new rules will allow marketplace sellers to earn up to 1,000 pounds before having to declare those revenues - but it doesn't apply until then, the newspaper said.

The article was sympathetic to small sellers, pointing out: "Last month it emerged that a taskforce set up by HMRC to ensure thousands of super-rich individuals pay their fair share had prosecuted just one tax cheat in seven years."

Should government tax-collection agencies do more to crack down on those who operate online businesses and fail to pay taxes on that revenue? And do they do enough to go after larger businesses?

With April 15th on the horizon, do you have questions about taxes due on your online earnings?




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by: FeelingFroggy This user has validated their user name.

Mon Jan 9 15:37:36 2017

Why would anyone one have any questions. YOU MAKE MONEY YOU PAY TAXES.

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This user has validated their user name. by: Ming the Merciless

Tue Jan 10 13:12:29 2017

It's always easier to go after the little guy who can't afford to fight back than it is to take on the rich who can afford to fight back.

I don't know about now, but the IRS at one time didn't require reporting for what they termed "hobby" businesses. Where the line of distinction was/is, I don't know.

What I do know is that the The Ho and The Devil made it a priority to turn profitable small and medium sized ebafia businesses into "hobby" businesses, bandkrupt businesses, or former businesses.

Ebafia, Amazon, and Walmart are the biggest killers of small businesses in the world.

Ebafia, for example, annually stashes billions in cash in non taxable off short accounts in the Caymans. The rest of us can't afford that.

So the rich -- both individuals and corporate -- by stealing from poorer individuals and businesses like us where here or in the UK.

Things likely won't be changing anytime soon.

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by: isaiah1212 This user has validated their user name.

Wed Jan 11 00:40:16 2017

I'm sure that most sellers already know that they can deduct certain business expenses that reduce, or alleviate any tax liability. This goes for "hobby" sellers also. This year, I purchased a yearly subscription for "MileIQ", which tracks all my business miles, issues weekly, monthly and yearly reposts which satisfy the IRS requirements for documentation. The $59 annual fee actually tracks those miles in dollars deductible, whether you're going to the post office, on a "buying trip", or simply going to the store to purchase tape, ink, paper, etc. Also, don't forget that any area in your home that is used exclusively for "business" can be pro-rated and deducted, whether it's a room, a garage or an actually storage facility. I know that these might seem like "chump change" to larger sellers, but for me, I can sell up to about $2000 a month and end up with a "wash" on tax liability. Every seller is different, but it doesn't hurt to add up the small stuff!

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by: rover This user has validated their user name.

Wed Jan 11 06:41:43 2017

Any right minded tax payer will use every legal loophole to minimise their liability, as cited by the poster above. Small sellers in UK can use ''cash based'' accounting method whereby all your expenses are lumped together and not itemised so the tax man does not know what your claiming for unless you get investigated. As with most exercises in form filling you make it ''look'' right and the assumption is that it ''is'' right. I know sellers who simply guestimate their taxes.

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by: epuise This user has validated their user name.

Wed Jan 11 12:55:07 2017

You SELL, repeatedly, you make INCOME, you FILE a TAX RETURN, you PAY Tax on PROFITS... nothing to NOT understand here.

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by: Toledo Maude This user has validated their user name.

Wed Jan 11 13:12:32 2017

Yes, thanks to eBay, my eBay business in it's 17 year is per the IRS a ''hobby'' and with eBay on going ''help'' will remain a hobby.  No growth, no growth, and more no growth.

And my once a week antique outings with the mileage allowance that the IRS gives us does keep my hobby business from making any profits.

For the most part we should be very thankful to rich (really, really, really rich) members of Congress that over the last decade or two have crippled the IRS.

Unless a small eBay seller is burying piles of 100 dollar bills in their back yard (McTool?), a small seller has little to fear from being audited by the IRS.

However, as a former tax preparer, I warned small business owners that go ahead and deduct anything you want.  Feel smug about it until that the moment an audit letter arrives from the IRS.



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