I have a domain name with a site of about 50 pages on it which I didnt update since almost a year. I'd like to "remove" that site and start a brand new one using that domain name. Will I get penalized by Google SE since it'll get many 404 errors when crawling my site next time? Should I remove all the old URLs in Google Webmaster Tools? Other question: Could my new site be sandboxed even if the domain isnt new?
Are you changing the theme of your site? Or is the new site going to be about the same topic, just different format/layout/site structure, etc?
Same theme, in fact its an arcade site, there was about 50 games on the old site. I removed them and downloaded a pack of about 5,000 games so 5,000 new pages at once and new layout/structure.
Those old URLs can give you a SEO advantage and maybe traffic - use .htaccess to forward the old dead pages to new valid ones.