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I have a personal website from which I receive a small amount

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I have a personal website from which I receive a small amount of money from Google for adverts which are posted on my website (£5 per day). I also pay google to promote my website which costs me more than £5 per day so I make a loss from the site. Do I need to declare anything on my tax return?
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
Hi
Thanks for your question - I am Sam and I am one of the UK tax experts here on Just Answer.
May I ask what your website promotes, you advise its a personal website, but for you to claim the costs that Google charge you - there has to be a trade for the expense to be claimed.
The money you make, however, from Google advertising, is money you should be declaring. Whether not not there is scope to argue the costs you incur are connected, is something that needs to be determined.
Thanks
Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13809
Experience: 26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
Sam and other Tax Specialists are ready to help you
Customer: replied 2 years ago.

When I put personal I was just meaning that I don't have a company, I make the website myself. The website provides links to news stories on the internet. I have adverts on my site which are provided by google ads and they pay me. I also advertise my website through Google ads so they put my ad on other websites in order to get traffic to my site and charge me for that. The amounts they charge me are sesperate transactions to the payments I receive and what they charge me is more than what I receive.

Expert:  Sam replied 2 years ago.
Hi
Thanks for your response - I understand how the charges come about, and yes the income is liable to tax, but I have to ascertain whether what you are then charged for advertising your website, can actually be reclaimable against the income or whether deemed to be a personal cost to you (rather than viewed as a trade and therefore an allowable expense)
And is this what you have been declaring to HMRC through your self assessment tax return.
I am trying to establish whether you have registered this as a business with HMRC or have cause to complete self assessment for other reasons -
When did this website first launch - and when did Google start paying you for advertising, and when did they start to charge you for advertising your website.
Thanks
Sam
Customer: replied 2 years ago.

I started the website 2 months ago so this has all happened in the last two months. I received my first charge from Google 2 weeks ago and I am expecting my first payment soon. I have not registered a company. I already fill in a tax return for my full time job as a Surveyor which is nothing to do with the website. I made the website for fun in my spare time with the thought that in the future if it got successful I could start a company for the website.

Expert:  Sam replied 2 years ago.
Hi
Thanks for your response and the additional information.
That's great that its a recent thing - then you must get registered as self employed for this website venture, and this will require you to declare the £5 a day charge for the advertising your permit, but also allow you to claim back the expenses you incur in advertising your website.
As this clearly will be a loss for the time being, this loss can then be offset against your tax suffered on your employment as a Surveyor, creating a small tax refund back to you.
It might be at some time in the future, if thee cost situation remains the same (you pay out more than you make) that HMRC will write and advise you there is no longer a need for this to be declared - and that they view it as more of a hobby than trade, but its their decision to determine this factor.
I would also advise that starting a company )limited) is not always as cost effective as you might think (as their are tax savings to be made but the accountancy costs and obligations to HMRC and Companies House far outweigh the savings to be made) so do seek advise at that time, to ensures you are taking this forward is the most tax efficient way to you (high street accountants will always encourage you becoming a Limited Company, as they know you are a viable earner for their fees!)
Let me know if you have any follow up questions on the information provided.
Thanks
Sam

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