How to start paying tax

[eBayThorLyfe]

Hi everyone
So I have been selling on eBay under my friends details for about 18 months now but I want to start paying tax as quite a bit of money is coming through.
If I am correct from what I have read I would now be ok to add a bank account to eBay in my name?
Thanks any info related is appreciated

[rsot]

For those 18 months, were you using your friend's bank account? Just clarifying

[eBayThorLyfe]

Originally Posted by rsot

For those 18 months, were you using your friend's bank account? Just clarifying

Yes that's correct I am still using a bank account we made under his details at the start of the account.

[eBayThorLyfe]

Can anyone help please ?

[SaiJin]

Originally Posted by eBayThorLyfe

Can anyone help please ?

You should have been ok using your own bank account from the very beginning.... Did you ever read the stealth guide?

Any ways what you can do now is ask your friend to perhaps add you to the bank ACC? That's a safer way so you don't need to change anything on the eBay side.

[eBayThorLyfe]

Originally Posted by SaiJin

You should have been ok using your own bank account from the very beginning.... Did you ever read the stealth guide?

Any ways what you can do now is ask your friend to perhaps add you to the bank ACC? That's a safer way so you don't need to change anything on the eBay side.

I wasn't on this forum then and thought it was the safest thing to do. In regards to buying the stealth guide I haven't yet as I think technically I am not doing stealth as i'm using real details? Me being added on has crossed my mind but HMRC are then going to surely contact him also? Ideally I don't want to pay taxes through a shared bank account I didn't know this was a thing. appreciate your reply I am really lost with all this.

[rsot]

OP, if sales are really high like this and you want that smooth transition, possibly have your friend add you on to account at bank and look at establishing a business - you might need to find professional tax advisor outside the forum

[eBayThorLyfe]

I am ready to be added to my friends bank account but I am very nervous about the whole thing, I really can't afford losing this account. Can you confirm if you know anyone that has done this method please?

[Hank]

You need to read these:

https://www.gov.uk/government/consul...s-consultation

https://www.taylorwessing.com/en/ins...eporting-rules

https://www.ey.com/en_gl/tax-alerts/...ital-platforms

https://www.gov.uk/government/public...eporting-rules

Ebay will soon be sending details of all seller activity to HMRC.

How it will play out is unclear but it seems very likely that the account holder will be responsible for any tax due.

Many of us with UK stealth accounts are already addressing the implications, you need to accept the possibility that HMRC will hold your friend responsible for the account, it's turnover and ultimately any tax due, to say the money 'belongs to you' probably won't wash. Plenty of time to legally circumnavigate it but it needs to be addressed, or you can wing it and wait for your friend to get a letter in the post.

Like I said, how it will play out is still anyones guess but forewarned is forearmed.

[agent006140]

does Ebay verify the name on the new bank account?
Assuming you are trying to replace the existing bank account of your friend with yours.
It may not be that easy,if so,anyone who hacks into a seller account can replace his bank account with another bank account !
i dont know how UK tax authority handles this,but in USA,IRS agent and state auditor will look at his bank account and figures these are either his salary if he works,inheritance,retirement fund,insurance claims,if not then it is taxable income and why didnt he report them?
State auditor is worse,they assume these are cash sales and he is not collecting sales tax.
The best is to say he is selling for you and he gets a commish for doing so.and you send him some form,in USA,we will send him a 1099 form showing he is a contractor,

[Hank]

Originally Posted by agent006140

does Ebay verify the name on the new bank account?
Assuming you are trying to replace the existing bank account of your friend with yours.
It may not be that easy,if so,anyone who hacks into a seller account can replace his bank account with another bank account !
i dont know how UK tax authority handles this,but in USA,IRS agent and state auditor will look at his bank account and figures these are either his salary if he works,inheritance,retirement fund,insurance claims,if not then it is taxable income and why didnt he report them?
State auditor is worse,they assume these are cash sales and he is not collecting sales tax.
The best is to say he is selling for you and he gets a commish for doing so.and you send him some form,in USA,we will send him a 1099 form showing he is a contractor,

They're not looking to change the bank account, merely add their name to an existing one.

AFAIK, this will not trigger any verification issues with ebay, indeed they'll not even need to know of the change.

Whilst not the same as how taxation is addressed in the US, there are issues around the corner which I've mentioned above which stealther will need to be aware of.

[agent006140]

friend today,enemy tomorrow.

[Freakzilla]

What's your current thoughts on this?

Originally Posted by Hank

You need to read these:

https://www.gov.uk/government/consul...s-consultation

https://www.taylorwessing.com/en/ins...eporting-rules

https://www.ey.com/en_gl/tax-alerts/...ital-platforms

https://www.gov.uk/government/public...eporting-rules

Ebay will soon be sending details of all seller activity to HMRC.

How it will play out is unclear but it seems very likely that the account holder will be responsible for any tax due.

Many of us with UK stealth accounts are already addressing the implications, you need to accept the possibility that HMRC will hold your friend responsible for the account, it's turnover and ultimately any tax due, to say the money 'belongs to you' probably won't wash. Plenty of time to legally circumnavigate it but it needs to be addressed, or you can wing it and wait for your friend to get a letter in the post.

Like I said, how it will play out is still anyones guess but forewarned is forearmed.

[eBayThorLyfe]

Originally Posted by Hank

You need to read these:

https://www.gov.uk/government/consul...s-consultation

https://www.taylorwessing.com/en/ins...eporting-rules

https://www.ey.com/en_gl/tax-alerts/...ital-platforms

https://www.gov.uk/government/public...eporting-rules

Ebay will soon be sending details of all seller activity to HMRC.

How it will play out is unclear but it seems very likely that the account holder will be responsible for any tax due.

Many of us with UK stealth accounts are already addressing the implications, you need to accept the possibility that HMRC will hold your friend responsible for the account, it's turnover and ultimately any tax due, to say the money 'belongs to you' probably won't wash. Plenty of time to legally circumnavigate it but it needs to be addressed, or you can wing it and wait for your friend to get a letter in the post.

Like I said, how it will play out is still anyones guess but forewarned is forearmed.

I have never wanted to avoid paying tax so this isn't really a slap in the face but only problem is the account holder will be liable. So what are people currently doing to legally circumnavigate it then? I feel like I am slowly coming to terms that I have to find another stream of income :( eBay has been great to me and there is so much potential on the platform I just can't seem to let it go.

[eBayThorLyfe]

Originally Posted by Freakzilla

What's your current thoughts on this?

I have never wanted to avoid paying tax so this isn't really a slap in the face but only problem is the account holder will be liable. So what are people currently doing to legally circumnavigate it then? I feel like I am slowly coming to terms that I have to find another stream of income :( eBay has been great to me and there is so much potential on the platform I just can't seem to let it go.

[Bassy]

Look up nominee middleman returns and talk to a CPA.

Never mind , this applies to usa sorry about that

[Nimble]

The account is in your friends name so in HMRCs eyes he is liable.

The easiest and simplest solution is your friend pays the tax and you pay your friend the taxed amount.

Otherwise, HMRC will look and see if your friend is trying to evade paying tax e.g if he pays the tax then would he move into a higher tax band and therefore is using you to negate paying extra tax.

HMRC like to see a trail so, as long as you can show the amounts moving from your friends bank account to your bank account, which matches up with ebay monthly statements, then I can't see this causing any issues, you will be asked why you are using your friends account, which is not a crime but be prepared for that.

Call in to the "personal tax helpline" and see what they say, you don't have to give them your real details for advice.

[Freakzilla]

I pay the correct tax on all my earnings. my issues is where some accounts are registered in stealth details, this info will be sent to HMRC. When they see these details are made up it will no doubt cause issues. As they have access to our bank account info they can see who owns the account.

Originally Posted by eBayThorLyfe

I have never wanted to avoid paying tax so this isn't really a slap in the face but only problem is the account holder will be liable. So what are people currently doing to legally circumnavigate it then? I feel like I am slowly coming to terms that I have to find another stream of income :( eBay has been great to me and there is so much potential on the platform I just can't seem to let it go.

[Freakzilla]

I don't think this is good advice. How can the poster prove they have any income NI contributions, etc. If HMRC look into them they will have to pay Tax on the income they receive in their accounts. Unless there's a reason, just create an ebay account in your name. What happens if you fall out with your friend, etc

Originally Posted by Nimble

The account is in your friends name so in HMRCs eyes he is liable.

The easiest and simplest solution is your friend pays the tax and you pay your friend the taxed amount.

Otherwise, HMRC will look and see if your friend is trying to evade paying tax e.g if he pays the tax then would he move into a higher tax band and therefore is using you to negate paying extra tax.

HMRC like to see a trail so, as long as you can show the amounts moving from your friends bank account to your bank account, which matches up with ebay monthly statements, then I can't see this causing any issues, you will be asked why you are using your friends account, which is not a crime but be prepared for that.

Call in to the "personal tax helpline" and see what they say, you don't have to give them your real details for advice.

[agent006140]

if you have the Ebay listings ,they would show the amount paid by the buyer,and you show the seller aint you with his Ebay ID and personal details.
if the Ebay details is all stealth,he would have more explanation to do.
I dont know what kind of friend OP is using,could be his mother or grandma?

[Freakzilla]

Op clearly says it's his friends details.

Originally Posted by agent006140

if you have the Ebay listings ,they would show the amount paid by the buyer,and you show the seller aint you with his Ebay ID and personal details.
if the Ebay details is all stealth,he would have more explanation to do.
I dont know what kind of friend OP is using,could be his mother or grandma?

[agent006140]

Originally Posted by Freakzilla

Op clearly says it's his friends details.

grandma and mother can be friends too.