Are you trading? – When does selling a few items become a trade
Posted on 14th November 2018
We all sell the odd item from time to time. But when does this stop being a personal transaction and start being a trade (creating the requirement to register for Self Assessment and paying taxes on any profits).
You’re likely to be trading if you:
sell regularly to make a profit
make items to sell for profit
sell online, at car boot sales or through classified adverts on a regular basis
earn commission from selling goods for other people
are paid for a service you provide
Ask yourself this – when you bought the item you are selling what was your intention for it. To make a profit by selling it (trade) or to use it yourself with no regard to its resell value (buying a product to ultimately sell but having personal use until you sell it could still be a trade). Also, is it something that you can see yourself doing regularly?
Trust your instincts – you will know your intentions and be best placed to realise your trading (even if you think it is just a hobby). As soon as you are “trading” you need to register for Self Assessment. You also need to consider the tax implications and start paying taxes.
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