Hi,

has anyone informed the tax man about someone breeding a lot of puppies so that they can look into it, and can you do so anonomously?

Certainly anyone breeding on a large scale (especially if they don't have much in the way of outgoings on their breeding stock) would perhaps be making enough to warrant the Tax mans interest.  I think they certainly would investigate after an anonymous tip off, but please be sure this really is commercial breeding.

A freidn of mine who has never bred more than a litter or two a year had a rather unpleasant time when her husaband was ill before retirement, and tried to claim sickness benefit.  some little jobs worth tried to make out they made money from their dogs.  Fortunately as he had been self employed their accountant was able to sort things out and show that in no way did their dogs make them any money but were a serious loss maker.

I would add that it doesn't have to be COMMERCIAL breeding - ALL income is supposed to be declared to the Inland Revenue, so even if you just have 1 litter, and you receive payment for them this, in the eyes of the Inland Revenue, is INCOME.   You have to keep records of what you have paid out, to prove that there is no PROFIT!

Margot

It is surprising how much checking the Inland Revenue do :) We had a PAYE inspection at work recently and the inspector went through ALL our payments out, to try to catch people such as window cleaners, cleaners, car valeting etc that are not declaring themselves :)

Daisy

The Revenue get a lot of annonymous "tip offs" and do wherever possible follow them through. As the average "hobby breeder" does not make a profit it may be difficult to supply enough information to make them decide it would be cost effective to pursue, but if the person is already under suspicion for anything else (even benefit fraud) they will eagerly jump on it. But do remember that if the person has no other income they will have to be making a large profit to pay tax on their puppy sales.

But if they have no other income, they must be making a large profit, otherwise how do they live :D

Daisy

We have a 'breeder' down the road who is always advertising at least 3 litters. I will certainly consider using this method to stop his exploitation. Kennel club registration dosent count when you are happy to claim that they are registered and hip scored until anyone asks to see the documenation. Then he either shows something relating to other dogs or threatens you :(  Have failed to get his adverts removed from local papers so perhaps this would work!     

How is he advertising ? Mr Tax Inspector reads local newspapers etc and does check up on people this way.

Daisy

If he is advertising KC reg & hip & eye scored & then they aren't, local Trades Description officer will be interested as well.....

Margot

Dosent actually use those words but does claim them to be in conversation. Ad says that they are 'pedigree' but we are 99% certain that any pedigrees shown do not relate to the dogs (roll on dna testing like they do in USA). Unfortunately most 'enforcement officers' are reluctant to go near him as he has a 'reputation' for violence. 

He advertises in the local free papers, so rats if I cant get him that way! He must breed about a litter a month (unless he ships them in :( ) so should be a fairly significant income. Everyone I know that has bought a dog from him has had either behavioural or serious health problems :(

two years ago we were "reported to the taxman" and we had to fill in self assesment forms and return them with all the reciepts within a deadline. after they had sorted all the outgoings against what few puppie sales we had. they sent ME a nice cheque for £298. so had on heart thank you to who ever it was. even though it was done out of spite.
I always keep all records of sales and expenditure. You cannot hide puppy sales as they as the KC for records of everything you have bred (not just sold) But if you are not working you are still allowed to have your tax allowence used on sales. so beware. if they think it is a hoax or just nasty you may well find that the boot is on the other foot. be sure of your info.
Also will this mean that we now should be charging VAT on our sales?????????????????
Terry

Only if you are VAT registered!

Current threshold for VAT registration is £58,000 - you would have to be breeding an awful lot of puppies to achieve a turnover of that :D :D

Daisy

We have only bred when WE wanted something for ourselves and then we have put a lot of thought into it. Over the last few years we have imported from europe to get better bloodlines and this has cost over £9000 in total. last year we bred 2 litters of 4 pups each. one litter we could not register because we had a fall out with the stud dog owner, so these pups went free to good homes on a spay/neuter contract. the other litter 2 pups sold and 1 given to the stud dog owner as fee. every person has a tax allowance and I believe mine is £14.000. as I do not work now.(sends hubby out instead) I will have to find our what my allowance is.
Terry

Personal tax allowance is £4745 (2004/2005) if you are under 65. Other circumstances can increase/decrease this

Daisy

Hi Daisy
How do you work these things out so quicky? Can having a large family etc increase this allowance?
Just interested
Terry

I'm an accountant (although I haven't had much to do with tax for about 20 years - it's not my area) - so I know where to go to look up the current allowances etc :)

A useful web-site (not just for tax) is http://www.adviceguide.org.uk/index.htm

Daisy

wow thanks that is really useful
Go on gotta ask what breed do you have.

I've got a Battersea mutt - sort of 1/2 size GSD, he's about 6 and an Aussie bitch who's 2 :)

Daisy

We have a Battersea boy. he is 1/2 collie and 1/2 Aussie = total nutcase.
Terry

:D

Daisy

  I've never reported a person, but I did 'question' my employer at the time 'VAUX' breweries. About 3 weeks later I got a lovely phonecall from the tax man saying he was sitting in the pay dept at Vaux and was pleased to inform me that I (and all my colleagues) would be recieving alot of back dated monies owed. :)
It's unfair for people to tax dodge, they're no better than people who commit benefit fraud. We are the ones who end up paying.
Selling puppies is trading, profitable or not, and no-one should be exempt from paying the lagal requirements that the rest of us are subject too.

Really curious about something concerning tax.  Someone I know has put all the dogs in her daughters name I pressume to avoid paying tax on litters but my husband thought this was no longer a get out clause.  Does anyone know. 

I keep all the reciepts for my dogs including shows, vets bills and food plus losing pay to look after them.  If you do it properly it doesnt add up too much if anything. 

I doubt that it would matter in whose name the dogs were - I presume that you mean the daughter is a child ? If they are satisifed that she is doing the breeding, selling the dogs and keeping the money, then she is the one with the business.

Daisy