UKC

Just seeing if anyone can give me advice so I don't have to spend hours on hold to talk to some grumpy HMRC phone monkey.

I've got a bit of land (1/3 acre) behind my house that I use for growing veg, chickens & the occasional bonfire.
I've found that I've got a lot more veg coming through than I can ever eat or preserve, and am keen to sell them on a small honesty stand out the front.

Do I need to register for tax purposes if I do this, or will they not care about £30 of courgettes & a few bags of spuds?

In reply to Bimble:

No, provided it is an unplanned natural surplus, ie not a deliberate plan to grow that much.

In reply to summo:

Great stuff, cheers. I underestimated how much I'd end up with (planted up 120sq metres in total), and have tons now. Shame to waste it.

In reply to Bimble:

I used to swop my excess for beer at the local!

In reply to Bimble:

Send HMRC a bunch of carrots and a couple of hardboiled eggs stating you hope that covers anything you might owe.

In reply to Bimble:

You are far to ethical for my liking.

In reply to Bimble:

Set up a subsidiary in Switzerland and claim your stuff is sourced from there. Worked for Starbucks.

In reply to Bimble:

I have nothing what so ever to base this on, but suspect that any income, planned or otherwise, will be taxable if there is a profit in it.......I hope I am wrong and that there is some scheme to encourage what you are suggesting!

In reply to Bimble:

Mrs Num Num and I are keen shoppers from honesty stands. Where about are you?

In reply to tmawer:


No, it is an unplanned or unexpected surplus from a non profit making venture. It's doesn't even come under 'farm gate sales'.

It differs from stuff that HMRC is now looking at like Ebay, AirBnB etc.. as the OP didn't deliberately buy the seeds and work for hours, to sell a few courgettes for a few quid, then retire to the Bahamas on the profit.

Depends on the location and the size of his road side stall, the council may object though, if there were traffic problems etc..

In reply to Bimble:





If they did you'd be able to offset the costs (land rent, seeds, compost, etc) - and as anyone who's grown veg knows - it cost more to grow your own than the price of tasteless supermarket veg.

Now if your excess is apples and you use make your own cider and then distill it in your secret still to make a lovely apple-based gin, then HMRC might start to get interested if you're supplying half the county with moonshine.

In reply to Bimble:

What taxes did you have in mind?

Veg is normally zero rated for VAT. And in any case, you don't have to worry about VAT unless you're shifting a lot more than £30 of goods a year.

If you make money from selling the veg, then you might have to pay income tax, at whatever your normal rate is. A farmer obviously does, but on the other hand if you trade your neighbour some surplus greens for a couple of eggs then you don't. There's a continuum in between these cases, and it can be tricky working out where to draw the line. I doubt you'll have anything payable though.

In reply to Bimble:

After expenses I don't think there would be anything left to tax anyway.all your equipment,workwear expenses would be deductible. If it were me I wouldn't worry about it.

In reply to Philip:


If you don't save money allotmenting then you are doing something wrong. My annual seed spend is £30-50 and we grow a lot of stuff. With well thought out planting, not over seeding, thinning, etc.. you should save money compared to the most budget supermarket veg. But, many people waste large swathes of their plot growing veg like spuds which you can pick up cheap enough locally anyway. Grow the stuff for the best taste, best margin.

In reply to summo:

opium poppies?

In reply to Bimble:

My local farm shop takes excess veg off local growers in exchange for credits to spend in the shop - that might be another option for you?

In reply to Tall Clare:

That's a good idea. Our village shop is a non-profit social enterprise that sells local produce. I'm popping in for some (fair priced for the local farmer) milk later so will ask if they fancy coming to an arrange t.

In reply to summo:

Costs are negligible to be honest.
The land rent is very low, seeds I either harvest from a previous year's crop or trade with others for new varieties, and any plug plants (strawberries etc) I get wholesale via a mate in the trade.

Fertiliser is free & in the form of rotted horse muck from the hunt stables up the lane, and I don't waste money on canes when hazel or willow is so readily available for free.

The only costs I really incur are for electric when I pump water up from the stream to refill the 1000 litre tank that then waters it all via gravity.

In reply to Bimble:


Sounds like you've got an efficient set up, which is clearly producing plenty veg.

I'd be little wary of horse manure, depending on how critical you want to be of course, as it often has weed seeds in if it's not rotted down fully. I'd avoid racing stock too, greater chance of chemicals etc. in waste. I'd imagine in your case the hunters are ploughing dodgy stuff into their horses.

In reply to Bimble:
http://m.thisislancashire.co.uk/news/13610317.Fresh_fruit_and_veg_fans__los...

In reply to Bimble:

If you live in Cheltenham, the deli next to The Daffodil does a veg exchange scheme - give them your veg and they'll give you bread etc.

In reply to marsbar:


How much of a chode must you be to complain about that?!

My land isn't council owned or an allotment, and I'm sure if anyone complained to the farmer who leases it to me, they'd be told exactly how far up their orifice of choice they could stick it.

In reply to Tall Clare:

That's an excellent idea, I'll have to tell my friend who lives near Skipton.

In reply to Timmd:

It's Keelhams farm shop.

In reply to Bimble:

Does your excess of vegetables include an excess of cannabis?

If so what are you opening hours please?

In reply to Trangia:

Bloke in the village got done for that a couple of years ago. Apparently the 4 rooms full of high-quality herb plants in his cottage was for personal use. Judge didn't quite believe him...

Unfortunately, marjoram is the most potent thing I'm growing. Damn you, clean DBS requirements.

In reply to Bimble:

Despite what you say I'd suggest a word with the HMRC grumpy monkey. Are you trading....yes is the answer. If so then HMRC will want to know. If you don't tell them & some snotty customer shops you then it can get very nasty & an investigation can be costly & time consuming.

Is it worth the bother of hiding it just for the sake of a few coppers?

The sooner that you inform HMRC the better. Don't put it off.

This the UKC Forum of course and you can happily ignore all advice & comments if you so desire!

In reply to Bimble:


Hmmm, you've got blood on your hands then

In reply to jon:


Nah, I wear gloves.

In reply to Alan Breck:

That's what I'm worried about. There's always bound to be a snitch with nothing better to do than have a complain.

I'll ask the local store (it was the ancient lady working today, I'd have got no sense out of her) and if they don't want it all, I'll ring HMRC & enjoy their wonderful 'being on hold' experience.

In reply to Bimble:
https://www.gov.uk/government/publications/farmers-and-market-gardeners-hs224-self-assessment-helpsheet

https://www.gov.uk/working-for-yourself/what-you-need-to-do

In reply to Alan Breck:

From that link

What doesn’t count as trading
You’re probably not trading if you sell some unwanted items occasionally or you don’t plan to make a profit.

In reply to Bimble:

You may have a LETS near you. Eg
http://mkletnet.org.uk

In reply to Alan Breck:


Doesn't apply, they aren't trading. If you sold some items from your house that you didn't need, unwanted xmas presents, few jars of jams, some cakes the WI didn't want etc.. at a car boot sale, technically you make a profit, but you aren't really trading in a business or HMRC sense etc.. It's a one off event due to unforeseen circumstances. Now if he sells a lot of veg this summer and next year he decides only to plant the stuff that sold well and grow even more, then there is a more deliberate business measure.

A market garden is a business. An allotment isn't. The only technical conundrum is that they are leasing the land off a farmer and not part of an allotment association, but given the amount of veg and monies involved, the person at the other end at HMRC will be thinking it is very small fry still.

Either way, as you say, it's the OPs call.

In reply to summo:

Sorry but you're not correct. A one off sale can be construed as a trade. There are numerous cases on this point but an example is:
The test to be applied is whether the operations involved in the transaction are of the same kind or character, and carried on in the same way, as those which are characteristic of ordinary admitted trading in the line of business in which the transaction was carried out. See CIR v Livingston and Others [1926] 11TC538 at page 542. This test requires an examination of all the badges of trade to evaluate the extent to which they characterise the facts of the case under consideration.

This approach was adopted in CIR v Fraser [1942] 24TC498. Fraser, who was a woodcutter, had bought a consignment of whisky in bond and sold it through an agent at a profit. Although many of the badges of trade were either neutral or favourable to the taxpayer, the court said at pages 502 and 503:


‘The purchaser of a large quantity of a commodity like whisky, greatly in excess of what could be used by himself, his family and friends, a commodity which yields no pride of possession, which cannot be turned to account except by a process of realisation, I can scarcely consider to be other than an adventurer in a transaction in the nature of a trade… Most important of all, the actual dealings of the respondent with the whisky were exactly of the kind that take place in ordinary trade.’

Now Bimble might not think it worthwhile declaring for just a few bob but there's always some comic who will shop you or write in to HMRC. While good old HMRC are not obliged to look at every anonymous letter they just might. If they do and it leads to an investigation then heaven help the poor sod. I've also seen it that an HMRC employee "looks up" an individual if for example they passed a roadside stall selling stuff.

It's down to each individual to decide what to do. If Bimble for example doesn't want to declare it then fine it's his decision.

In reply to marsbar:

You’re probably not trading if you sell some unwanted items occasionally or you don’t plan to make a profit...........Sorry but that's not a get out. Selling some unwanted items occasionally can be a trade. The desire to make a profit is pretty much irrelevant as regards trading. Some businesses are set up only to make a loss but they're still trading. I think that the get out is: PROBABLY NOT TRADING. It doesn't say that you're not trading!

I'll agree that it is a bit of a minefield but a read of the taxes acts and the associated tax cases will clear it all up.

In reply to Alan Breck:

That's what the website you gave says.

In reply to Alan Breck:


Or just take a deep breath and go climbing...

In reply to Alan Breck:

poor example of case law, as Bimble has not deliberately bought something then sold it on. If he bought 1000 packets of seeds, used 2 then sold 998 on for profit, it would be different.


Bimble hasn't bought the veg, he has grown it, unless you can say he planted a hectare of spuds, which is clearly even beyond a chip addicts normal consumption, but he hasn't. Even looking at his outlay, he is hardly investing in veg growing hoping to make an income from roadside sales.


I will agree there is always some jobs worth, who probably take joy in harassing people.

Edit; I also add that he isn't 'adding value' to the product to increase his revenue. If you made jam out of fruit, or cordial etc. you can argue that you've put work in to increase your margin. This is also not the case here.

In reply to summo:

Best of luck with your arguments. There's nothing there which will hold water but you obviously know best. Over to you and Bimble to sort out!

In reply to jon:

What a good idea.

In reply to Alan Breck:


I base my knowledge, not on your case law, but 40 plus years of being connected with allotmenting. I've probably known 100s of allotment owners, in several different places, I've yet to ever hear of anyone being taxed or having to declare a little bit of money from roadside sales. The same goes for flowers, eggs and honey.

Whilst this has nothing written down to mean things won't change in the future, the past treatment of this is a fairly good indicator of HMRC's current stance. The law or rather HMRC do need to be clearer on what hobby sales are though.

In reply to Alan Breck:

Aarghh, legal stuff!!
I think it'll just be easier to take it all to the pub one weekend & see how drunk I can get via bartering.
I managed to get hammered off trading in 6 rabbits before, so I see no reason why this should be any different.

In reply to Bimble:

Sounds reasonable.

In reply to summo:

But will he he be allowed to have an 'unplanned surplus' every year?

In reply to Alan Breck:

Could HMRC please direct all this investigative prowess in the general direction of Amazon/vodaphones/Starbucks/etc please?

It just seems utterly ridiculous that this lad is worried about his honesty box when those lot don't pay ought on their billions.

In reply to Bimble:


If it is an honesty box then any money exchanging hands is a donation, though I am not sure if this makes it exempt from the Sherriff of Nottingham wanting a cut?

I'm sure that folk sell more stuff through ebay than your garden surplus and never pay any tax on it and while were at it - what about the chancellor and his family and all his mates. Perhaps if the tax inspectors do come you should tell them you sold your London development site/courgettes to an anonymous company from the Cayman Islands?

In reply to Alan Breck:


I think I'd want them put on a disciplinary charge for wasting time. Like dr_botnik, I'd prefer to see them pursuing the odd billion, rather than wasting my tax pissing about over a few quid from some courgettes or jam.