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Small new business

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  • 04-11-2011 3:15pm
    #1
    johnnyw20
    Registered Users Posts: 202 ✭✭


    Hi
    I am looking to set up a small business selling from home via a ecommerce website. I want to sell cricket gear but my turnover will not be very much as I wont be holding much stock and most items will have very low value.

    I have registered the business name with CRO and I have a company building a website for me.

    My question is...do I need to pay tax on the items I sell as the are not worth very much and the tax payable each year will be very little.

    John


Comments

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    #2
    jjll
    Closed Accounts Posts: 1,200 ✭✭✭jjll


    yes you will have to pay the tax on everything you sell no matter how small amoount you get


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    #3
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    You don't pay income tax on what you sell but profits, and you will be far below the threshold to have to register for vat.


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    #4
    The Apprentice
    Registered Users Posts: 1,130 ✭✭✭The Apprentice


    jjll wrote: »
    yes you will have to pay the tax on everything you sell no matter how small amoount you get


    As below.. well below the threshold for paying tax.. incorrect information.


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    #5
    jjll
    Closed Accounts Posts: 1,200 ✭✭✭jjll


    The Apprentice wrote: »
    As below.. well below the threshold for paying tax.. incorrect information.


    everything you sell 21% has to to be paid in tax to government so aprentice 100 euro sell 21 euro has to go to government you are one giving wrong info


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    #6
    Kinetic^
    Closed Accounts Posts: 13,249 ✭✭✭✭Kinetic^


    jjll wrote: »
    everything you sell 21% has to to be paid in tax to government so aprentice 100 euro sell 21 euro has to go to government you are one giving wrong info

    Please stop giving out wrong information. Unless the op plans on selling more than €75,000 worth of goods, then he does not have to charge VAT.


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    #7
    Axwell
    Moderators, Computer Games Moderators Posts: 10,462 Mod ✭✭✭✭Axwell


    Kinetic^ wrote: »
    Please stop giving out wrong information. Unless the op plans on selling more than €75,000 worth of goods, then he does not have to charge VAT.

    No they are not giving out wrong information, you are talking about two different things. The apprentice is wrong for the same reason, both of your comments are referring to VAT while jjll is referring to Income Tax.

    The thresholds for VAT for supply of goods is €75,000 as you said and they arent required to register for VAT until they go over that.

    For income tax they would be liable for 20% on any profit made.


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    #8
    Kinetic^
    Closed Accounts Posts: 13,249 ✭✭✭✭Kinetic^


    jjll wrote: »
    everything you sell 21% has to to be paid in tax to government so aprentice 100 euro sell 21 euro has to go to government you are one giving wrong info
    Axwell wrote: »
    No they are not giving out wrong information, you are talking about two different things. The apprentice is wrong for the same reason, both of your comments are referring to VAT while jjll is referring to Income Tax.

    The thresholds for VAT for supply of goods is €75,000 as you said and they arent required to register for VAT until they go over that.

    For income tax they would be liable for 21% on any profit made.

    "Everything you sell 21% has to be paid in tax to government".

    If he sells something at a loss does he still have to hand over 21%? The 21% mentioned would imply that he was talking about VAT. If he's talking about income tax then you both have the rates wrong.

    Income tax rates are 20% up to 32,800 and 41% thereafter for a single person (other rates for married etc). That doesn't include PRSI or income levy. These rates would be applied to any adjusted net profit made.


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    #9
    Axwell
    Moderators, Computer Games Moderators Posts: 10,462 Mod ✭✭✭✭Axwell


    The point was jjll didnt refer to VAT in their post so telling them they are giving out wrong information was incorrect.

    OP at the end of the day you don't file tax returns for the current year until October of next year. The reality of it all is if the business is going to be making tiny profits then the amount you are going to have to pay is minimal unless you are selling a lot of products. I would imagine by the time it comes to filing your tax return you will either have decided you aren't making enough money for the time you are investing in it and gone on to something else or you will owe a small amount as income tax.

    So just keep in your mind that you will owe 20% on your profits and set that aside as you go along or make note of it in a speadsheet and focus on getting the business up and running at the minute. Your main concerns should be making a viable business out of it and generating sales and profits at this stage.


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    #10
    jjll
    Closed Accounts Posts: 1,200 ✭✭✭jjll


    right this is getting on my wick if its items you are selling then you have to pay tax on it to government ...... they way some of ye are talking no wonder country is in crap that you dont pay taxes ...... no matter what a person buys apart from child clothing or baby food which incase people think i am talking out of my arse check tax website... if you buy an item for 1 euro a percentage goes to tax man i apolagise axwell for comments now


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    #11
    Kristopherus
    Registered Users Posts: 11,907 ✭✭✭✭Kristopherus


    jjll wrote: »
    right this is getting on my wick if its items you are selling then you have to pay tax on it to government ...... they way some of ye are talking no wonder country is in crap that you dont pay taxes ...... no matter what a person buys apart from child clothing or baby food which incase people think i am talking out of my arse check tax website... if you buy an item for 1 euro a percentage goes to tax man i apolagise axwell for comments now

    It appears to me that you have no idea how a business operates. In the initial year, the OP will not HAVE to register for VAT as he will not reach the threshold of €75000.00 turnover. All the taxes he will pay is on the product he will buy from suppliers.If he is lucky, he will make a small profit. His net profit will be smaller again, so it is very unlikely he will pay any Income Tax as his allowances will be greater than his liabilities.
    If you mean that any tax, be it Income Tax, VAT, PRSI or USC, then, literarily, you are correct. But most business understand tax to be of the Income kind. It is generally understood that the other taxes are part of business transactions.


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