HMRC are hitting the hobbyists hard with a clamp down on hobby businesses!
Research by RBS claims the in the UK 1 in 5 adults are ‘hidden entrepreneurs’ . What is a hidden entrepreneur? I just do this for a hobby! Well the official definition is the people who spend their spare time on a hobby or hobbies which could or do earn them an extras income. The figures with the report from the RBS Enterprise report state that ;
- 38% of these people reported that they had actually earned money from their hobby no matter how much.
- 15% hope that in time their hobby would turn in to a full time business
- 10% were using their hobby as a step in to a career change.
Commenting on this research Thom Kenrick, Head of Sustainability Programmes at RBS, said “We’ve believed for some time that lots of people are undertaking enterprising activities without associating themselves with being an ‘entrepreneur’. This research shows there is an untapped potential right across Britain of people who could be successful in business”.
HMRC have launched a campaign aimed at people who are currently receiving this kind of second income, they define a second income as people who are employed and are paid wages through PAYE for their main job but are earning extra money through thing such as;
- Consultancy, public speaking or providing training or teaching (including being paid to teach people to make cakes, cards, knit..)
- Organising parties and events or providing entertainment ( that includes all the sales from Ann Summers reps, Avon, Younique, Forever Living, Body Shop…)
- Giving regular car lifts for a paid travel (counts as a private hire fee), Hairdressing, Gardening and handyman help.
- Making craft and selling it anywhere (baby sales, Christmas fayres, Facebook, ETSY)
- Buying and Selling goods (Regular market stalls, Car boot sales)
- Baking cakes for sale (Selling them on car boots, facebook ..)
What to do if you think you have a second income like this?
HMRC are regularly targeting different groups from Ebay sellers to handyman and electricians, Whatever it is that you do in your spare time you need to declare it, If you do have a second income you can declare it using a really simple form found here. If you think that you are one of the 15% who really think their hobby might grow in to a fully fledge business one day, The ideas cupboard can help you look at what your doing and where it will fit in the market, helping you to turn your hobby in to a profitable business with a complete brand, we can even help you get your business on to the internet to expand your current business market. we would love to hear from any start up business or any one who is considering it as we can help put you in touch with the correct people who will help you to fund and grow your idea and make it a reality.
Speak to us to today for help setting up your business or growing the ‘hobby’ business you currently have in to a more substantial company, we support any person in any industry regardless of size. #ibacksmallbusiness