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Hobby dog breeder, tax query

Do i need to claim, what can i claim

Didn't find your answer?

Hi,

I had a litter of pups in 2018 and a bit confused as to whether i need to pay tax. Hmrc not that helpful as they aren't sure themselves. I breed rarely, this is my 2nd litter ever. 

I need to know what exactly can i claim for as i am not a business. Can i claim for loss of income? Can i claim for all her keep leading up to her delivery? How far back can i go as not claimed against her. I do campaign my dogs so needed to know whether costs relating to that can be claimed? 

Any help would be helpful as i have spoken to an accountant but they aren't sure either and not sure i should be submitting anything as it is a loss anyway need to have these questions answered.

Thanks

Replies (41)

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By Tax Dragon
18th Jan 2020 20:16

You have a loss only because you are including private expenditure which is not deductible for tax.

What do you actually do for a living? By the sound of it, it's not breeding dogs.

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Replying to Tax Dragon:
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By Magicbus
18th Jan 2020 20:59

I have a loss because of all the expenditure relating to the litter but i wanted to check as so many people have said income of £1k or more needs to be declared even if you make an overall loss, is that true? I didn't have the litter to make money it was to keep one to continue to campaign.

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Replying to Magicbus:
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By Tax Dragon
20th Jan 2020 10:25

Quote:

I didn't have the litter to make money it was to keep one to continue to campaign.

So, a private purpose.

As I said, you have a loss only because you are including private expenditure which is not deductible for tax.

How much did you sell the other pups for?

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By Tax Dragon
18th Jan 2020 20:17

Oh and question 2: how much did you sell the pups for?

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By lesley.barnes
18th Jan 2020 20:21

Have you looked at The Kennel Clubs website with regard to HMRC badges of trade with regard to dog breeding. How do these apply to your situation? You describe it as a hobby and you made a loss. Why are you completing a SA have HMRC asked you to complete a SA because you sold a litter of pups?

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Replying to lesley.barnes:
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By Magicbus
18th Jan 2020 21:00

Yes i looked at that and needing a licence and hmrc are different, it talks about income and not a profit. I don't need a licence, don't breed enough for one as i discussed it with my council.

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Replying to Magicbus:
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By lesley.barnes
19th Jan 2020 09:45

I would go along with what others have said based on what you say its a hobby - with the proviso that it would depend on what you sold the pups for and what your legitimate expenses were. I used to act for someone who was self employed and as a hobby showed dogs but he very occasionally bred pups/got stud fees or a % of the sale of pups in place of stud fees. His dogs were first and foremost family pets so what he could claim was limited by this. He made a profit after expenses and declared as it on his tax return. The pups were sold for around £2k each so high value. That is why I referred you to badges of trade. Another client bred and trained gun dogs as well as being self employed and again high value for a trained dog, not so much with pups so there was a smaller profit margin because of the mix.

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By lincolnartist
18th Jan 2020 20:32

You had a litter of pups? That's scientifically amazing

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Replying to lincolnartist:
By Paul D Utherone
19th Jan 2020 21:28

Snigger...my first thought also, well it's getting to the end of January

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Replying to lincolnartist:
Hallerud at Easter
By DJKL
20th Jan 2020 12:11

I viewed it more as a dog which can type is pretty special.

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By Tim Vane
18th Jan 2020 21:07

I vote not a trade. Rien à déclarer. Ring HMRC and ask them to withdraw the notice to file and remove you from SA.

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Replying to Tim Vane:
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By Magicbus
18th Jan 2020 21:23

I am self employed so need to do my business anyway which is in no way related to this litter. My council did say that in their eyes if i were to have 1 litter every year then they would look at it as systematic trading and i would need a licence and therefore be a business which i have no intention of doing as it's hard bloody work and not profitable lol
Ok i won't submit anything but i have all my records anyway.
Do i need to contact HMRC again as they took my details when i was trying to get answers which couldn't be answered?

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Replying to Magicbus:
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By Tax Dragon
18th Jan 2020 23:49

I'd just white space it (box 19 on TR 7 if memory serves). It's not sounding taxable and similarly no loss is allowable.

Had you sold for under £1000 and not already been self employed, I'd have said leave it off altogether (hence my earlier questions).

On the other hand, because you are already self employed, you ought to have thought about VAT.

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Replying to Tax Dragon:
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By Magicbus
19th Jan 2020 08:45

VAT? My business doesn't make anything near which means i need to consider that. I'm a sole trader

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Replying to Tim Vane:
RLI
By lionofludesch
19th Jan 2020 10:10

Quote:

I vote not a trade.

I vote not a trade too.

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Replying to OldFart:
By Ruddles
19th Jan 2020 00:48

I thought that there was a nasty smell around here. You really are so predictable.

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Replying to OldFart:
Psycho
By Wilson Philips
19th Jan 2020 08:43

Quote:

It's always been generally accepted that 2 or more litters of puppies a year constitutes a business.


Generally accepted by whom? DEFRA say 3 or more.
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Replying to OldFart:
Psycho
By Wilson Philips
19th Jan 2020 11:25

Can you provide a link, because DEFRA themselves say that their guidance is based on HMRC’s ‘rules’.

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Replying to OldFart:
By Ruddles
19th Jan 2020 15:45

So, as per usual, you have nothing to back up your claims and are making it up as you go.

Moderators - I think we need some air freshener.

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RLI
By lionofludesch
19th Jan 2020 10:06

"I had a litter of pups in 2018 and a bit confused as to whether i need to pay tax. Hmrc not that helpful as they aren't sure themselves. I breed rarely, this is my 2nd litter ever."

Jeez - I thought it was the dog posting a query.

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Replying to lionofludesch:
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By Magicbus
19th Jan 2020 10:43

Jeez - I thought it was the dog posting a query.

[/quote]

Why so rude? I just needed a reply to my questions.

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Replying to Magicbus:
RLI
By lionofludesch
19th Jan 2020 10:52

Quote:

Why so rude? I just needed a reply to my questions.

Rude - in what way ?

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Replying to Magicbus:
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By lesley.barnes
19th Jan 2020 11:52

No one has been rude to you as far as I can see quite the opposite. People have tried to help with the limited info we have.

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Replying to Magicbus:
By Red Leader
20th Jan 2020 10:15

Lion simply posted the joke that the rest of us were already thinking!

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Replying to Red Leader:
RLI
By lionofludesch
20th Jan 2020 10:23

And, in at least one case, already said.

I had already cast my vote in favour of not taxable.

Still, it's winter. There are likely to be snowflakes around.

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By bernard michael
19th Jan 2020 10:35

What breed are the dogs and are the parents registered with the Kennel Club ??

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Replying to bernard michael:
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By Magicbus
19th Jan 2020 10:44

They are KC reg, parents and the litter were. I show my dogs.
Price of pups is nothing like some breeds go for so not anywhere in the region of £2k

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Replying to Magicbus:
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By lesley.barnes
19th Jan 2020 11:48

What was the price of the pups then?

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Replying to lesley.barnes:
Hallerud at Easter
By DJKL
20th Jan 2020 12:14

Don't you mean, "How much is that doggy in the window"?

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Replying to Magicbus:
RLI
By lionofludesch
19th Jan 2020 14:53

Quote:

They are KC reg, parents and the litter were. I show my dogs.
Price of pups is nothing like some breeds go for so not anywhere in the region of £2k

How about saying what the price was instead of what it wasn't?

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Replying to lionofludesch:
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By lesley.barnes
19th Jan 2020 15:15

I think we can take it that the poster wanted a reply telling them it was a hobby rather than a trade based on the scant information provided. No wonder the accountant they consulted wasn't sure. Our work is done.

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By memyself-eye
19th Jan 2020 15:53

I have friends who have just acquired a pooch - a Shitsue (at least that's what it does around the house). It's 'Ruff' on them as they have no grandchildren, so 'Rover' is a substitute. I think they are barking mad and should paws for breath but the animal does have Pedigree....

Chum.

Should they inform the HMRC?

Answers on a post card to: Collie-ers Row, Ridgeback St, Barking, Newfoundland.

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Replying to memyself-eye:
Psycho
By Wilson Philips
19th Jan 2020 16:04

Did you hear about the animal park that had only one animal, a dog?

It was a Shih Tzu

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By Anne Robinson
20th Jan 2020 16:47

Is it just a coincidence that a very similar question has been asked on another forum?

Or a case of if you dont get the answer you want ask ask ask again until you do.

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Replying to Anne Robinson:
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By Magicbus
20th Jan 2020 16:56

That is a friend who is in the same position as me as she wasn't sure either as is herself. She told me she had posted on there after i had here. We were both very confused.
I have spoken at length today with an accountant who deals with people who breed dogs on a frequent or not so basis.
A tax return will be going in, hobby or not once £1k has been handed to me that makes it something which needs to be submitted regardless of profit or loss.

Thanks everyone for your replies.

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Replying to Anne Robinson:
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By Tax Dragon
20th Jan 2020 17:04

Does the missing information appear in the other forum, or are the contributors there being left to guess too?

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Replying to Tax Dragon:
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By Magicbus
20th Jan 2020 18:03

I have no idea what info she posted as it would be related to her and not me.
I didn't see how the breed or the amount the pups were sold for had any baring on this which is why i didn't respond to that here on an open internet site. If i had Labradors and priced at £1k a pup how would that make any difference to say a Boxer sold at £1200 a pup? Or a Cocker sold at £900 a pup?
Thanks though for the replies.

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Replying to Magicbus:
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By Tax Dragon
20th Jan 2020 18:28

Quote:

I didn't see how the breed or the amount the pups were sold for had any baring on this.

Well a one-off transaction in the nature of a trade is taxable as a trade. The more commercial you were as you went about selling, the more likely it is that the transactions were trading ones and hence that the profit is taxable - or loss allowable. The price fetched might be a factor in establishing the commerciality or otherwise of your approach. Other factors are likely more important, but I wouldn't have asked the question if I hadn't thought it might have some relevance. I have better ways to waste my time.

Quote:

Thanks though for the replies.

No worries. (No, seriously, please don't worry... this is my last.)

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Replying to Tax Dragon:
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By Magicbus
20th Jan 2020 18:04

I have no idea what info she posted as it would be related to her and not me.
I didn't see how the breed or the amount the pups were sold for had any baring on this which is why i didn't respond to that here on an open internet site. If i had Labradors and priced at £1k a pup how would that make any difference to say a Boxer sold at £1200 a pup? Or a Cocker sold at £900 a pup?
Thanks though for the replies.

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Replying to Magicbus:
RLI
By lionofludesch
20th Jan 2020 18:19

Quote:
If i had Labradors and priced at £1k a pup how would that make any difference to say a Boxer sold at £1200 a pup? Or a Cocker sold at £900 a pup?

There's a lot of mugs about.

No pedigree dog owner has ever read the story of The Emperor's New Clothes, it seems.

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By bernard michael
21st Jan 2020 09:57

Offered as possibly relevant
Interestingly (?) I was told by an HMRC senior Inspector that if you bred a horse and then sold it you were liable for tax but not if you bought a horse and sold it
His words not mine and I didn't argue as it suited my position

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