UK Warriors....

Very silly question. Of course.

Of course. You would be crazy not too. If the taxman finds out you could get into serious trouble.

Plus paying taxes is what pays for roads, hospitals, etc. There is something good about contributing.

Kenneth

Indeed. But also remember to keep receipts/records of any purchases (domains, hosting, products etc) so you can claim them as expenses.

The only business in the UK that is tax free is spreadbetting if you good at forex or oil get in there

In 2012? We wish!

IMHO it's worth investing in a book or chatting to someone if you want to do your own books and then pass them onto an accountant. It can often work out cheaper rather than getting them to do it all. But have a chat and see what they say.

Yes, but I think that if you earn less than around £7,500 a year, then you don't need to pay tax, but you still need to pay NICS2 national insurance contributions which is about £131/year. Someone correct me if im wrong.

To begin with, if you are just beginning and don't expect much income, you can probably roll your online earnings into your annual tax return - but seek professional advice because it isn't always all that clear cut.

As you income grows and becomes more regular, in other words a real business rather than an occasional paying hobby, you will probably be classed as a 'sole trader'. In which case you will need to contact your local tax office and tell them that you are planning to trade as a sole trader. An accountant is definitely a help here.

As a sole trader you will be expected to submit your accounts annually and be assessed for tax purposes. Note that initially you may be charged tax on your last year's earnings and an assessment (by the tax office) of the upcoming year as well. Sole traders pay tax in advance, based on estimated earnings, and then have adjustments made according to the actual earnings in the next year.

If, however, you decide to become a Limited company, your tax is then assessed entirely in arrears (i.e. on the money you made in your last tax year). There can be other advantages to being a limited company, such as paying company tax rather than income tax, which can be at a lower rate.

If this all sounds complicated, it is. You will need to keep accurate records of all your income and expenditures, with all paperwork and receipts.

The very first thing you should do is talk to an accountant to at least find out how to approach things.

If you're not in employment you can earn around £7000 a year tax free. If you earn a little from your online earning then put it on your self assessment form.

If you earn more than £10000 a year and (particularly if your day job earnings are high) then you might be better off with forming a limited company. Then you can pay yourself dividends.

Not declaring income? The chances of getting caught are actually quite low, although if you sell physical goods (e.g. on eBay) then there's a much better audit trail back to you. Also don't make enemies, because HMRC find most tax cheats due to tip offs.

Pay your tax, otherwise you are setting yourself up for some big problems. (and you would be dishonest by not paying, and its never good to be a dishonest person).

IMHO: about the Tax issue - look up what where the taxes actually go please, let me give you a hint:

Income Tax: The interest on the national debt - that is all, the interest!
Gambling Tax: Hospitals.

Check for yourself

I'm shocked this question was asked!

What earnings!

Realistically, only a nutcase would say "no I don't pay my taxes" on a pulic forum...

Here you go,

We turn over more than the threshold:

VAT Number: 129 9038 90
Company Number: 07868697

If you speak to the inland revenue / HMRC and register as self employed they will offer you a free place on a course which will teach you everything you need to do about your tax obligations and how to make sense of it all.

Very beneficial session!

For those that are vat registered, do you have to charge vat on your products like ebooks for example?

I've got two other online companies which are both well over the vat threshold and are therefore obviously registered. Therefore my new IM ltd company needs to be vat registered due to the associated companies rules (just solves problems).

Not seen any sales websites selling ebooks which inc vat. Not sure how to account for it with selling digital products.