Full time employment + supplementary income below 2.5k
I work in full time employment and do the occasional bit of web design as a sole trader which per year amounts to less than £2,500. I am confused as to why someone can receive up to £2,500 as say a gift or earnings from selling items on eBay and not have to pay tax but I am filling out a tax return declaring my minimal extra income and being taxed for it.
I called HM Revenue & Customs about this matter after receiving a letter entitled "Should I be in Self Assessment" and I didn't get a straight answer. I was given the example of an eBay seller but it didn't help me understand where I stand with regards to declaring myself self employed as well as employed by another company.
Is this a contradiction that if you declare yourself as self employed but earn under £2,500 you are still liable for tax but if you don't declare yourself self employed and earn under £2,500 then you're off the hook so to speak?
I've been in this situation for the past 5 years and the recent HM Revenue & Customs letter through the post only served to confuse me. My simple question is, should I un-register as being self employed but still keep tabs on my earnings to make sure I'm not exceeding £2,500?