How do I know when I will start being taxed ect?

[wannabie]

In some countries paypal takes the TAX ID and informs the tax dept about the specific income threshold via their medium. For example freelancer earning 1k USD per month for entire year is reported to tax entity via paypal. Happened here in this part of the world. I am not sure about the UK or EU taxman with paypals co-operation on earning.

They do over a certain limit but I think its random amounts or they report on anything thats out of the blue

Taxman gets told by the bank how much your account has earnt in interest, and from that they can roughly work out how much money you've had through it, if its higher than the amount they know you earn then they could start an investigation but that's only if you raise that flag, its not hard to get caught either

The UK have got very very hot on tax avoidance due to the Gary Barlow/Jimmy Carr 'scandle' along with people paying builders/freelancers cash blah blah - It's a big topic at the moment and the taxman isn't stupid - I would sooner have the police on my back rather than the taxman

If you go to court and fined for a criminal charge and can't pay they tend to let you pay by installments, if the taxman fines you then they want that money, if you don't have it then you get a loan, if you can't get a loan the bailiffs come round, they sell your stuff for half the amount its actually worth and you still owe the taxman money

 

[farlack]

For USA paypal doesn't send anything to the IRS unless you've made $20,000 in sales, and 200 transactions.

No expert here, but I would have to assume since they're donations, you can probably claim it all of a loss, as you intend to use the funds to pay for your website, and not profit any, right? ;P

 

[0scan0]

First of all I need to know where you live, before giving advice, US?

 

[Cas87]

 

[wannabie]

I am not 100% sure on this part, but i think hosting/domain costs etc.. can't be claimed as an expense. not sure how it works for self-employed, a business etc.. so you would have to read up about that.

You can in the UK