Are paypal funds taxable in UK?

E

editwork

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Hello People,
If I have funds in PayPal I am not withdrawing that on my bank account, using it for online purchase. Is that taxable in UK?
Ex: I received $XXX amount of money from Xyz company on my UK PayPal but I use that money to buy some online services. Is that money taxable?


Thanks
 
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Thread moved.
 
Short answer is likely yes. Not really clear what you received the money for so can't say for sure. If you provided goods or services yes, if you are being above board and declaring the income of course.
 
When I pay € to USD, the seller always gets less and sometimes I am not sure about paypal
 
If money hits your

1. Bank account
2. PayPal account
3. Any other merchant accounts

...then yes, its taxable.

Disclaimer: im not an accountant so take it for what its worth
 
br3ach said:
Short answer is likely yes. Not really clear what you received the money for so can't say for sure. If you provided goods or services yes, if you are being above board and declaring the income of course.
Click to expand...
Like i said i am not withdrawing it to my bank account, i keep that money on my paypal for purchasing online services(pbn, domains server etc etc)
 
It doesn't matter if it is in your paypal account or in your bank account it is still taxable income unless it came from a source that has been exempted from income tax.
 
editwork said:
But i am not withdrawing it to my bank account, i am using it to buy online services.
Click to expand...

not doesn’t matter. You should be paying tax on the income and claiming on the expenses.

If you are paying it all out anyway then you wouldn’t pay tax on it, because you’d be claiming all of the expenses against the income, but you still need to go through the process and submit the return.
 
I think the personal situation is clear based on the answers received.

The ONLY caveat I would say is if you are a registered business (you can't just say you're a business). If its a business then in the UK then you pay on the profit, not income. You still need to record the income and spend in your books.

I doubt this is what you are referring to but I thought I would mention on the off chance :D
 
I'm not totally clear on this but there is definitely an allowance which is tax free, for example your first £1000 income as self employed is tax free. Again, I'm not totally sure so correct me if I'm wrong, and btw this info can all be found on the gov.uk website
 
Yes, obviously. Imagine if the only thing you would need to do to avoid taxes is put your money on Paypal.
I mean come on people.
 
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