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Going big but what about taxes
 

Hi guys,
i need your advice. I have had my stealth account for over a year now with absolutly no problems however now ig ot a new business idea which i belive may put me at risk. So i started to sell phones now and had around £4k turnover in the first two weeks. PayPal already started to ask me questions on where do i get my stock from and to provide proof of delivery for each of my transactions etc.. I got this all covered so far but im worried if they will need more information in the future which i wont be able to provide.

Does anyone here had experience with high turnover accounts? How did you deal with them?

Another question is how do you deal with HMRC? As my expected turnover for this year will be around £100k im sure taxman will want to have a look into it. Im going to register as a self employed and get an accountant but how can i make it work? My eBay and Paypal accounts are stealth! Please help!

May i just add. I buy and sell my stock through eBay only and i pay with paypal only. Im TRS with around 700 feedback.
Im sorry if i didnt make my self clear. Im not a native speaker:nono:

Re: Going big but what about taxes
 

congrats on your business.

the paypals are stealth but they go in to your real name bank, this is usually all that matters, regarding reporting.

others may chip in but if there is a tax enquiry, eg. wanting more info on the actual paypal accounts, the only explanation is that they are 'doing business as' or DBA names. Whether this is acceptable, maybe another forumer who has experienced it can tell you, from what I have read, paypal/ebay are not financial institutions like banks, and you do not have to give your real details to them by law, but it is a grey area. Getting a professional tax advisor is worth it for you, they can also write-off alot of your expenses and reduce your tax.....

Re: Going big but what about taxes
 

Tax questions should be handled by a tax professional - consult one,

@OP, what I dont understand is why are you doing high turnover on accounts when you don't know how to handle them......research beforehand from now on.

Re: Going big but what about taxes
 

Thanks for your responses!
oompaloompa, i think you may be right, i can trade under a business name and i believe this name will be shown on invoices too.
Also im thinking to change name on PayPal account as they give such a option. ATM im using my second name and real surname.

So im thinking to add my first name to it with slight change- David instead of Dawid. I think i may be able to get away with that :D

#rsot, i had no clue this new business venture will work so well for me so i didn't do any deep researches. I will get an accountant some time next week and let you know what he says.

Many thanks

Re: Going big but what about taxes
 

second name and real surname, to me is not even very stealth, it is your real details, no need to change it or mess with it.

you may want to stay with the forum and learn to make a few unrelated back up accounts too, and keep them seperate, just in case your main ebay/paypal has issues, they can be done with business names and business address eg pobox, for your business it is worth doing properly.

Re: Going big but what about taxes
 

Dont forget that the accountants fee is a tax deductable business expense as well!

Re: Going big but what about taxes
 

Not a good idea. Avoid flagging your account at all times especially if adding a name that was on a suspended account.

You must be careful.

Make sure you speak to a tax professional as soon as possible too.

Good Luck

Re: Going big but what about taxes
 

Then post about it here? Sounds good, go on. :nono:

Re: Going big but what about taxes
 

I'm from the US, so keep in mind that this may NOT work in the UK!

When I have an account that has been nurtured enough to go over $20k in sales per year, which triggers the tax reporting requirement, I usually switch the PayPal account to a business account and use the name of a real LLC. My LLC's are all legally set up and my accountant handles the tax reporting aspect of it. Using multiple LLC's DOES mean paying the accountant a bit more, but it gives me confidence knowing it is being done legally.

Maybe someone from the UK can chime in and let us know if this method will work there?

Re: Going big but what about taxes
 

If your making that kind of money then you really do NEED a tax professional.

The idea is to give as little as possible to our thieving governments who will waste it on illegal wars, foreign aid to fund corrupt warlords, and lots of whacky causes that taxpayers never voted for.:d

Personally disgusted at the amount of taxpayers money that the British government has squandered in this way at the height of a recession and I know I am not alone in this. I would cut by 90% the amount of money that goes in overseas aid to bongobongo land.

Re: Going big but what about taxes
 

Money paid in foreign aid is a drop in the ocean compared to what is squandered at home on so called 'benefits'

There is sound economic reason for giving aid to so called bongobongo land countries as we in the western developed countries rely very heavily on them for cheap resources, most of our food and cheap labour in manufacturing industries from which we all profit