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    1. TomofNottingham is offline

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      #1

      eBay Accounting Advice - How to Keep Records for Tax Purpose

      Hey guys. I just recently began my own business on eBay and Im after some information about what exactly I need to do on a regular basis to prepare myself for tax time. I dont want to be scrambling around when the time comes, pulling my hair out and worried Ill either not get my fair share back or owe way too much.

      Id be happy with any feedback at all. Thanks.
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    2. Thank you for this post:

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    3. NeilG is offline

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      #2
      First, you will need to get some spreadsheet software, record books or ledgers; basically something to keep track of all the numbers you’ll be recording. You would also need folders for receipts, statements and bills, which you should keep separately. After you get those, follow these steps routinely:

      Keeping logs of any expenses

      • Keep track of inventory costs—whatever you pay is what you put down. Keep any receipts.

      • Record any and all eBay fees (those to list the item, and when it sells), which should be noted in a monthly statement sent to you by eBay. Also, keep the statement.

      • When an item is sold, print out an invoice for yourself with any information related to it stapled. Have the date on it as well. The HMRC likes to see an organized paper trail. Be prepared.

      • Note of the costs of packaging supplies, including boxes, stamps, scales, mileage to the post office (mileage logs can be bought separately), labels, paper for packing slips, etc. and keep the receipts. Also, note any discrepancies between what you have charged your customer for shipping and what you actually paid.

      • Record any fees by PayPal and keep any statements.

      • Again, I would keep everything together for each sale and organize it by date. Keep it month-to-month, too.

      • You can even attribute expenditures like broadband and phone bills to your business, but just make sure not to take it too far.

      Keep track of income

      • Record how much each item was sold for and keep a log of your profits.

      • Always remember to keep business money separate from personal money, no matter what. Treat your business like a truly legitimate business. I have known people who give themselves some sort of percentage of profits for a type of salary, but most of the money should be going right back into the company.

      Depending on how much business you do on eBay, you might want to consider hiring an accountant, just to be safe. That’s something for you to consider, though. There are also excellent accounting software programs out there that are very user-friendly and helpful.

      Follow this (it gets more routine each day) and tax time will be a breeze. And remember to be honest always — you don’t want to incur any problems down the line just to save a few extra bucks in the short-term.
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      serena lee (28 Oct 2012), cheertone (27 Oct 2014), bizmanny (12 Feb 2015)

    5. Nataliez is offline

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      #3
      Great tips. Thank you so much for posting this.

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      shopping-sports (07 Jul 2013)

    7. hotdesigns is offline

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      #4
      Hi, my company, Abacus Accounting by Mail Ltd, My Abacus offers low cost monthly bookkeeping, accounts and tax service. It starts at 15per month plus VAT for up to 25 transactions. You can get a quotation online and I may be able to give you some tax saving advice which will cover the cost of the service. No obligation, just thought it might help take the stress away.

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      cheertone (27 Oct 2014)

    9. ali.adel1990 is offline

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      #5
      What I personally do is a MS access database and put the entries as sales occur, but as you scale up, it gets kind of hard.

    10. newebaywholesaler is offline

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      #6
      I would imaginge it would be possible to get a breakdown for your sales from ebay or paypal in excel format with your bill every month? Has anyone any experience with this as I am starting off myself and will have a lot of low cost goods and high volume and printing them off one by one would be a nightmare?

    11. Emma Pollard is offline

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      #7
      I do accounts for someone who trades through paypal, he prints off his statement each year for me to work from. It can be confusing though, especially if you trade abroad as well, but if you do it weekly or monthly it should be easier. Also, if you follow the advice above then you should only need to cross reference with the paypal statement anyway.

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