Smouser
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Government need to fund all their money wasting exercises and we all have 4* hotels to pay for....
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Craig-SM
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Art is treated as capital expenditure so it would be a capital gainWe all need accountants to understand all of the minefields
I understand the capital gains tax is not applicable to my situation.
However, just as an example, let's say you have bought a painting for £5k and 5 years later you sell it for £10k. Does that then only attract CGT or CGT and count as income?
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I seem to buy stationary engines, restore them and sell them at a loss, would HMRC give me money? 
colnerov
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I seem to buy stationary engines, restore them and sell them at a loss, would HMRC give me money?
What do you think?
Craig-SM
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turn it into a sole trader business and offset the losses against your employment income that way your total income is less and you would get tax back on the losses.I seem to buy stationary engines, restore them and sell them at a loss, would HMRC give me money?
I really should be doing my clients tax returns than giving away tax advice
hotponyshoes
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We all need accountants to understand all of the minefields
I understand the capital gains tax is not applicable to my situation.
However, just as an example, let's say you have bought a painting for £5k and 5 years later you sell it for £10k. Does that then only attract CGT or CGT and count as income?
It's one or the other. Not both.
If you bought it with the intention of selling it evrntually when it was worth more it's income.
If you bought it to look at, then a few years later sold it because you found out it was worth more that's capital gains.
If you bought it, sold it a few years later because you desperately needed some money and it only makes £50, then sorry. No refunds.
I can't think of any workshop type stuff that is liable for capital gains tax if held as personal items.
Basically personal stuff that wears out is not liable and I think that covers all the stuff the op is selling?
I think the only real question is if he is trading or not.
Or, really, if he is comfortable that he can explain to hmrc that he is not trading.
Smouser
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Fancy having one more client?turn it into a sole trader business and offset the losses against your employment income that way your total income is less and you would get tax back on the losses.
I really should be doing my clients tax returns than giving away tax advice
Craig-SM
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In January! Everyone loves a comedian, this is why accountants have such a high rate of suicide.Fancy having one more client?
ajlelectronics
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But they have many skills. For instance; when constipated, they can work it out with a pencil and paper!
addjunkie
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Thats good advice, especially if you set up a new venture, you can carry your loss back, think its 3 years and get nice rebates….turn it into a sole trader business and offset the losses against your employment income that way your total income is less and you would get tax back on the losses.
I really should be doing my clients tax returns than giving away tax advice
Pigeon_Droppings2
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My general rule of thumb is...if I sell a personal asset for more than I paid for it then I need to think about whether there is any tax to pay.
I'm not saying there's always tax to pay.....just that tax needs to be considered.
Best thing for the OP to do is ask an accountant...but it helps to think thro the questions before hand.
hotponyshoes
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My general rule is...I pay enough tax on my income (including stuff I sell on).
If I sell a personal item at a profit and there is no tax due I want to be aware that there is no tax due and not pay it.
hotponyshoes
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Here is the part of the handbook they follow to determine if you are "trading" or not.
Have a read through and see how many boxes you tick on it..
It's clear on there that "fixing something up" and selling it on could well be considered trading.
Although that one box may not be enough if all the others are crossed out.
It would be on you to prove that it was not.
If you were a member of a club that repaired welders for fun every Saturday from 2pm-5pm that would stand in your favour.
Or you can provide an equally convincing excuse
keithski122
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Handy to know as I'm setting up a new venture as well as my part time job and in the last five months its been nothing but costs with no income.I've kept accounts and will do a tax return as I want to keep things legit.
Kram
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Interesting, how would CGT apply if instead of a painting, it were a car? Say you get bored easily and like variety..
Buy car for £10k, use it a while then sell it on for £13k. Buy another car, keep a year and sell again.
Im told its quite easy if paitent, to pick up cars well below market price from a different area, use and then sell on for profit. I've never sold a car, they always die on me eventually
Buy car for £10k, use it a while then sell it on for £13k. Buy another car, keep a year and sell again.
Im told its quite easy if paitent, to pick up cars well below market price from a different area, use and then sell on for profit. I've never sold a car, they always die on me eventually
addjunkie
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As far as Im aware you need to register your business with HMRC. Worked well for me as I was a high rate tax payer. So got some healthy rebates. If your venture is a partnership you can share profits or losses between both partners. So in our case as I pay tax on my pension, our loss making business is used to initially reduce the tax my Mrs pays on our other business, if theres any loss left, I get it to generate a rebate. BTW its very easy to make a loss with a farm.
hotponyshoes
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Interesting, how would CGT apply if instead of a painting, it were a car? Say you get bored easily and like variety..
Buy car for £10k, use it a while then sell it on for £13k. Buy another car, keep a year and sell again.
Im told its quite easy if paitent, to pick up cars well below market price from a different area, use and then sell on for profit. I've never sold a car, they always die on me eventually
You don't have to pay capital gains tax on a personal car.
But, if you buy and sell many cars at a profit you have to prove you are not trading in cars otherwise you have to pay income tax.
I can belive you that you can buy cars from remote areas, get bored of them quickly and sell them on a few months later for a profit.
But it's not me you will have to convince of that
keithski122
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I'll check it out with my sister who does book keeping.Shes already advised me on ways to spend money and what can be used as business expenses.
Craig-SM
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Just as an update for this thread, HMRC have made the publication on 3 Jan 24 to clarify between trading, selling off unwanted items and separate link to capital gains to hopefully avoid confusion.
www.gov.uk
Check if you need to tell HMRC about your income from online platforms
Find out if you need to declare income from selling personal possessions, goods or services online, creating online content or renting out property using digital platforms.
