CJ - VAT & Tax question

[loozx]

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Hi there,

I'm a new online business owner, recently I've been using CJ for my income but I had a few queries regarding tax and VAT.

A little background info - I'm from the UK & the sales & commission gained is all from the US. First of all, I'm under the impression that everything I get from CJ is already taxed so would I be eligible for double taxation? And if so how does this work?

My final question is regarding VAT, I received a quote of £291 from Valueclick a minute ago which is telling me I have to pay VAT on my CJ commission, I thought you had to be earning over £100k for VAT to apply? Surely I don't have to pay this?

Thanks

[SeanMac]

loozx

Just a few points on your post:-

1. You will need to pay tax on your earnings, even that earned from overseas as I understand it. I think you sign a declaration with CJ to say you are based outside of US and will be paying tax locally. As I understand it, it is not already taxed so you need to pay this in the UK. Thats my understanding anyway.
2. If you've recently registered as self employed its likely you wont need to file a return yet. They allow you to operate for the first 12months without filing a return eg if you registered as Self employed in April 2011 then your first return wont be required until around end Jan 2013 (check with the tax office on this) - but be warned when it does come time you will need to pay all your first year tax + 50% of year 2 all at once so make sure you set some aside :-)
3. The threshold for being VAT registered is £70k if I recall. Dont worry about what it says on your Valueclick invoice about paying VAT unless you are above this level and therefore VAT registered.

[loozx]

Thanks for the reply Sean,

I contacted CJ & they said that I'm excluded from the VAT Which is great!

I currently work a 9-5 job and I've only recently started earning via direct deposit from CJ. I've been trackings my spend's since the money first went in. Do I need to contact the tax office and tell them about this? Also do I declare any money I make via Paypal?

Thanks

[SeanMac]

Loozx

I think, theoretically, all earnings would need to be declared. Paypal is just the mechanism of payment ie like bank transfer or cheque but it is all earnings. If your additional income is going to be ongoing then you will need to declare them. I am by no means an expert here so you might be best asking the Tax office for more accurate advice.

[Mogga]

I suspect you'd benefit from a little reading

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There are lots of useful things here.

[jezza101]

I would expect anything you earn is subject to normal income tax no matter how or where you earn it from? If you want to do it by the book, and I'm sure you do, it all needs to go into your accounts.

The upside is we are doing our bit to help pay off the national debt