Hi,
After losing my job, my confidence and about three stone last summer, I started selling my old clothes on ebay, and buying new ones for my svelte self.
Fast forward a few months, and apart from the pounds creeping back, it's become more than a hobby...an obsession I suppose. I'm buying to sell, and over the past couple of months have sold £2.5k worth of stuff - and probably half of that is profit.
I know that I have to change my ebay account to a business one, and I realise I need to register as a business or as a sole trader. I just have a couple of questions I was hoping someone might be able to answer.
- I was planning on registering as a sole trader. I understand that this makes for very simple accounting. Sales less expenses equals profit. And I can keep all the profit so long as I stay under the tax threshold which I believe is £11,500 - therefore not a problem.
If I've understood it right, all I need to do is keep my receipts and a record of costs, and when I need to fill in a self assessment (not going to be until January 2019 now) I can download a sales report from ebay (taking fees and paypal fees off). Is that right?
So far, so easy.
- I already have my own limited company which I use to do consulting work. That sounds very grand, but it has yet to cover its startup expenses (which included a training course costing £2k), and so it certainly isn't going to make a penny profit any time soon. So long as I don't pay myself any dividend or salary, am I right in thinking that I'm ok to receive expenses from my limited company (mileage primarily - but also heat and light and mobile phone etc.) without it counting towards my £11,500 tax limit?
- My last question is about timing. Do I need to register as a sole trader from last April? I don't have receipts or suchlike going back that far, as I never thought it would become so serious.
If I register effective today, what do I do about stock that I already have (I've got about 350 items upstairs so lets assume they are worth £2k). Can I effectively 'sell' them to my newly registered sole trader self, so that it's a clean line - everything I own or sell from today forwards becomes a business item?
I know I probably need an accountant - but right now there is no way I can afford one, so if anyone can advise on these few points I'd be really grateful.
Thank you