Hello. I live in the UK and I have a question. If I make something really awesome and I get donation via paypal, do I have to pay tax? What if my donations reach £50/day? What is the limits of donations I can get to be tax free ? Thanks.
No matter whether it is a service fee, a purchase payment, or a donation... If it's income... it's taxable.
I see. So, what percentage would I need to pay and where could I start with it? I am really new here and don't earn much so I think there's no need to worry about tax as my earnings are about £5-£10 a day, I think I need to earn more than £100 a week in order to be taxable. I just don't really want to get caught and get sued ... Thanks
That depends on personal or business and also whether the money lands in UK... if you never draw the money to your bank account 'technically' it isn't money it is merely an electronic signal. If your PayPal account is a business account you really should have the funds included in your accounts receivables. If personal - it up to you if insignificant amounts - the audit might come 20 years after your death.
I have a premiere/business type paypal account. I think they tax me already. So If want to withdraw my money to my credit/debit card, I don't really need to pay another tax as PayPal already tax me? Thanks.
Fill out a self assessment form at HMRC and you will have your answer!!!! All income besides gambling winnings is taxable! Even inheritance is taxed! Unless it is work for cash in hand, all the income is generally recorded in bank statements, paypal, electronic info etc.. Though if you're under a certain tax bracket you're probably safe! Check out HMRC, that's the best advice!
If you get £50 per day than I would have another question... is it cheaper to make offshore company?