I am starting a different topic for this as it is not related to my original query about a strange puppy enquiry. what expenses that you pay out for dogs are deductable from any profit you make on a litter of puppies?
I know I spend far more in total on my dogs with their food, vets bills training fees and show entries etc than I am ever likely to make selling the odd puppy, but would the tax man only allow  expenses to be claimed that are directly related to raising the litter?

a 'hobby' breeder who only breeds occassionally to further their own line etc would probably not fall under the notice of the tax man. tax on breeding really only applies to those who are making a profit from it, such as puppy farmers.

> a 'hobby' breeder who only breeds occassionally to further their own line etc would probably not fall under the notice of the tax man. tax on breeding really only applies to those who are making a profit from it, such as puppy farmers.

I would agree with this but others don't...... seriously I'm sure the tax man has better things to do than go after people who breed the odd litter of pups. If it did come to it and you had to put down thisas income then yes you would put down what that bitch has cost you to bring up for 4 years

> If it did come to it and you had to put down thisas income then yes you would put down what that bitch has cost you to bring up for 4 years

surely then you would have to prove to the tax man that you bought the dog to breed?  There is talk at the moment about having a landlord tax to ensure that all hobby landlords with buy to let properties pay enough tax - where is the difference?  If anything in the current climate you are more likely to make a profit breeding pups.

> If anything in the current climate you are more likely to make a profit breeding pups

how? far less so i'd say, people don't have the money to buy a pup as easily so running on time is in many cases longer. on the other hand vet costs for health testing and pre and post natal care have not gotten cheaper, nor have feeding costs etc.

> how?

in comparison to being a landlord with plummeting property rates, rental rates dropping, a glut of properties and no-one renting them.

ah right, make more sense, i read it wrong :)

> surely then you would have to prove to the tax man that you bought the dog to breed

Either it's your pet in which case no tax to be paid, or it's a brood bitch and then she becomes an expense of your business, a tool of your trade in effect which of course you can offset the cost of keeping her against tax

Any income you receive is subject to tax after allowing expenses.  Strictly speaking, even money made from car boot sales (as an example) is income and therefore taxable.  Whether you decide to declare it is obviously up to you.  It makes no difference whether a pet or not.  That said, I think it highly unlikely that anyone breeding carefully and responsibly would make that much of a profit.

>Strictly speaking, even money made from car boot sales (as an example) is income and therefore taxable.

And eBay.

>a 'hobby' breeder who only breeds occassionally to further their own line etc would probably not fall under the notice of the tax man. tax on breeding really only applies to those who are making a profit from it, such as puppy farmers.

No, they probably wouldn't fall under the notice of the tax man, but the tax still applies regardless of how much or how little they breed. It relates to income, not quantity of litters.

>I would agree with this but others don't...... seriously I'm sure the tax man has better things to do than go after people who breed the odd litter of pups. If it did come to it and you had to put down thisas income then yes you would put down what that bitch has cost you to bring up for 4 years

How much it cost you to raise a bitch for 4 years? LOL They must employ some really silly tax men if you can claim to be a hobbiest but offset costs like a business.

> How much it cost you to raise a bitch for 4 years? LOL They must employ some really silly tax men if you can claim to be a hobbiest but offset costs like a business

There's no law that says businesses have to make money hence the term tax loss

> Strictly speaking, even money made from car boot sales (as an example) is income and therefore taxable.

I don't think that is true about boot sales or ebay.  The only way you would be liable for tax on ebay (and therefore boot sales) is if you buy things to sell.  there is no tax liability for selling things you have bought for personal use.

ETA: I have found a link supporting this with info from HMRC http://www.theregister.co.uk/2007/02/09/ebay_uk_traders_tax_guidance/   The same would also apply to boot sales unless you are buying things to sell on.

> there is no tax liability for selling things you have bought for personal use

No - but Revenue and Customs do look at things like Ebay, newspaper ads etc to see who is doing more than just sell a few secondhand clothes. They also do things like sit at railway stations and note taxi number plates etc and check this against tax returns. It also happens that people have to explain how all their possesions (ie sofa, table chairs, TV etc) were paid for - so a large cash income CAN be identified :( Another example is that when we had an inspection at work we were asked who cleaned the office windows - these people would then be checked to see that they were declaring their income.

Daisy

I know of two people that have ben caught out on epupz by the tax man, they can check how many litters you have advertised.

Linda

I know of two people that have ben caught out on epupz by the tax man, they can check how many litters you have advertised.

Linda

Same here but with benefits cheats

Angela

>Same here but with benefits cheats

This is one thing they are definately clamping down on in many ways. We've had problems with people parking up cars for sale along side one of our most popular parks and they've since been told to move the cars on and this time they have passed the owners details on to the relevant agencies. Needless to say, there's not one car parked there now! LOL

> but the tax still applies regardless of how much or how little they breed. It relates to income, not quantity of litters.

i wasn't refering to the number of litters but the level of taxable income, which in the case of good breeders is generally to small to be taxed. the occassional litter does not bear a heavy profit where as continual litters yeilds more of one.

> How much it cost you to raise a bitch for 4 years? LOL They must employ some really silly tax men if you can claim to be a hobbiest but offset costs like a business

why shouldn't you? if you bought a cappucino maker for yourself then later chose to sell coffees wouldn't you class maintenance of the machine as a business expense?

its horrible thinking of our beloved girls that way but thats how the tax man would think about it. i doubt they'd quibble as its a legitimate expense.

i wasn't refering to the number of litters but the level of taxable income, which in the case of good breeders is generally to small to be taxed.

Well, it depends if the breeder has another form of income that uses up the personal allowances.

About 4 years ago I had to visit the local Tax office. I went along wearing my jacket which has dog club badges on the collar. Chatting to the Tax inspectors there I was asked if I would help them identify dog breeders who were breeding for money. They were interested in people who were regularly breeding litters of puppies whether registered or not. They had no problem they told me with a hobby breeder who breeds a litter every couple of years.

I did not by the way help them find particular breeders then, but since then have thought about what they said and have regularly reported people I find who are puppy farming or are involved in dog dealing since then.

> How much it cost you to raise a bitch for 4 years? LOL They must employ some really silly tax men if you can claim to be a hobbiest but offset costs like a business.

We have some confusion here on what can be offset, and what not.  Also the difference between Capital expenditure and running costs.  IF you  are keeping proper business accounts (as you will need to if you are breeding and selling several litters per year).  Your initial purchase costs of dogs, equipment etc are all capital expenditure, then associated costs for keeping them, showing, vets etc are offset as expenditure against the income form puppy sales, stud fees etc.  You can then "write down" the value of the Capital by a percentage, year on year.  However, this is way more than most hobbyists need to do, and a simple profit and loss type account will do, with basic income and expenditure details, giving you a profit or loss at the end of the year.  This is not (unless you have a very, very friendly tax official) retrospective, so you can't offset 4 years costs of keeping a bitch against 1 litter.

Also wanted to point out that it is your total income which is taxed, not per litter.  If you are working and your wages are paid with tax deducted, then you are already over the tax free threshold.  Also need to bear in mind that some benefits and all pensions are taxable too, so these need to be taken into account when you fill in your SA form/work out your income/tax payment threshold.

As a non-breeder, I would have thought that the 'normal' show owner who has the odd litter to keep a pup just wouldn't be bothered with trying to offset capital expenditure (although they must, of course, be aware of any potential tax implications of breeding). The 'running' cost of their dogs would be pretty immaterial as it is their hobby and they would look upon any sales of 'spare' pups as a contribution to the cost of their hobby :) Anyone who is looking to offset every last penny against income including the 'capital' outlay and normal running costs must be someone who is purely into breeding to make money :)

Do I have the wrong idea of breeders ?? :)

Daisy

Hi Daisy,  I was trying to point out that a lot of posts on this sjubject (on this thread and on the related one about prices) are advising people that all costs can be included as expenditure, but this is a very simplistic view of the accounting process, and that large items and the cost of the dogs themselves are not allowable as offset expenses in your income/expenditure calculations.

Gwen - I agree :) Some people do think that ALL the costs of owning/breeding are taken into account - which of course they are, either as capital or revenue, by (only) those whose main business is puppy production :( In much the same way as a pig breeder :D

Daisy

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