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        When does AP become a 'business'?

#1 Hogster Dec 05, 2005 08:00 PM

When does AP become a 'business'?
 
Hi guys,

Just wondering .... I'm thinking of taking aerial photos of my local town to sell to the townsfolk (nice 20x16" prints or some such) .... I know this is a process by which I make a financial gain, but does doing this make it a requirement to set myself up as a business?

I can understand if I was dealing with large companies, property developers, land owners, etc .... but with members of the public? You have arts and craft fairs where people run stalls ... they haven't set up their own businesses ....

The main aim of this little venture would be to earn enough cash (800+) to set myself up with a Swift 16 electric helicopter for AP work .... now with I wouldn't mind setting up a business as it would be a very handy and practical machine for small AP jobs - my AP plane is just too impractical for small shoots .... maybe over farmland but not for property stuff.

Any thoughts?

Cheers muchly,


David

#2 JWarren Dec 05, 2005 08:16 PM

The rules here in the US may be different than in your country.

If you fly a plane and take pictures, that's a hobby.

If you are selling photos, you are in business.

If you are offering to take Aerial photos on commission basis, then you are a business and may fall under rules or laws which are regulated by your aviation commission.

My thoughts.

John

#3 kd7ost Dec 05, 2005 08:26 PM

To me what you're describing isn't a business. You can make money here by doing things like you describe without having a business. There is likely a money cutover point for taxes though on earned income. But you can mow lawns, shovel snow from walks and driveways and such for reasonable monetary compensation without making it a business. IMHO, Selling a few pix to buy a new RC plane wouldn't be concidered a business here. You just would have to let the people know up front that you don't give out receipts.

Dan

#4 askman Dec 05, 2005 10:12 PM

it becomes business when you decided to. :) mostly it does involve certain amount of income in most country. (even though in US, all income needs to be declared)

#5 Ducman69 Dec 05, 2005 10:17 PM

You're talking about such a small dollar amount, I doubt most people would even claim it as income on their taxes.

In the US at least, I'd probably only be interested in setting up a business like that for tax breaks. I'm not an expert, but I know from friends you can write off a lot as a not-for-profit business. I believe you get further deductions the first year you start your business. You only need to be able to potentially prove that you're actually doing what you say you are and purchases need to be business related.

Thats going to vary by location though, but something to lookup. If you don't want to bother with it, then simply don't IMO. You'd be so low on the radar its the equiv of mowing a couple lawns in the summer.

#6 Hogster Dec 06, 2005 04:24 AM

Interesting! Thanks for your replies guys. I agree there's not really that much difference between earning money like this, and mowing all the lawns for the people in the village. :) Although with that you're doing them a service ... selling aerial photography photos can't really be considered a service unless they ask for it ...

Oh well, I guess I'll just have to see how it turns out ...

#7 glydr Dec 06, 2005 04:46 AM

It would be a good idea to check your local tax laws - ignorance is not an excuse.

Here in Aus there is a certain dollar amount before the tax office is interested in 'hobby' income.

Hope you get your heli soon.

#8 Hogster Dec 06, 2005 05:27 AM

Valid point glydr, I'll see what info I can scrounge :)

#9 Hogster Dec 06, 2005 05:44 AM

Just sent this to my local council:


Good morning,

I am curious to know when council tax becomes applicable to small jobs like washing cars, mowing lawns, etc, or in my case selling photographs (taken from my model aircraft) of my local town to the townsfolk. Is it the actual 'income' which triggers some form of tax, or is it the type of job?

Would selling aerial photos invoke a tax which I would have to pay? When would something like this be classed as a 'business', and what would be required of me should it reach that level?

Many thanks,


David Hogg
Cobham, Surrey

#10 Phil R Dec 06, 2005 06:48 AM

It's not your council office you want to be talking to...

Have a chat down at your local Income tax office, or Citizen's advice bureau.

Or...

Just join the black economy

#11 Hogster Dec 06, 2005 07:29 AM

Ah right ... this is the email address I used:

http://www.elmbridge.gov.uk/atoz/def...241&var_az=tax

Just sent it to this address:

http://eshercab.tripod.com/Email.htm

Thanks Phil

#12 Hogster Dec 06, 2005 10:31 AM

Got this reply from my local council:

If a significant part of your home, or some other property, is given over to your business, you may be liable to business rates.

But if (at present) you're operating from your bedroom, for example, then you'll have no business rates liability.

You'd need to ask the Revenue about income tax.


Lookin' hopeful! :D Now I just need to contact Inland Revenue ... :o

#13 Gray Dec 06, 2005 11:12 AM

Hi David,

As far as I can make out, if you do not have any other income your tax allowance is about 4,895 per year, so you can earn up to that before the taxman becomes interested.

I think this is correct but do follow it up.

All the best with your venture,

Gray

#14 Hogster Dec 06, 2005 11:35 AM

Oooh! :D I'm liking the sound of that!

#15 alexeames Dec 07, 2005 11:28 AM

Hi Hogster

in practice, the Inland Revenue will only be interested in you when you start to make taxable profits. If you spend all the income on r/c gear, most of which would be fixed assets, which you can write off against tax over 3 or 4 years, unless you are earning vast sums of money, they are not going to be interested in you.

However, it is worth keeping all your receipts and paperwork. Because if you do start making profits, you will be able to claim back for your purchases (backdated several years - can't remember the exact figure).

In practical terms. If you are not already a UK taxpayer, you can earn 5 grand with no worries. If you are already a UK taxpayer, it may be better to think of it as a self-funding hobby - as long as you don't make large profits.

But keep all your records in any case.


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