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Old 04-01-2013, 05:02 AM
squidgyjelly squidgyjelly is offline
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Default Paying tax UK?

Hello

I was wondering how tax is paid on Iphone Ipad IOS game sales in UK?
Do I have to declare it as an individual or is is auto deducted?

THanks
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Old 04-01-2013, 05:20 AM
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ThreeCubes ThreeCubes is offline
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it is not deducted, you need to be a company or change your tax to self assessed. If you go self assessed you have to state all earnings per year and your tax is calculated on the whole amount you earn.

if the appstore is your only income and you earn less than the min tax allowance (9k) you would pay no tax (except National Insurance). if you earn over 9k you will start to pay tax at 20% just like a normal job.

if you have a normal job to then the money your earn from the appstore should be added on and you get taxed on the whole amount.

Really you need to at least be self assessed as the money you earn from the appstore is easy for the IRS to see as its all electronic transactions.
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Old 04-01-2013, 05:35 AM
squidgyjelly squidgyjelly is offline
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Default UK

Thanks for reply but I am not USA for IRS I am UK citizen and yes I have day job but I have not registered company for Iphone publishing and will stat individual publisher
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Originally Posted by ThreeCubes View Post
it is not deducted, you need to be a company or change your tax to self assessed. If you go self assessed you have to state all earnings per year and your tax is calculated on the whole amount you earn.

if the appstore is your only income and you earn less than the min tax allowance (9k) you would pay no tax (except National Insurance). if you earn over 9k you will start to pay tax at 20% just like a normal job.

if you have a normal job to then the money your earn from the appstore should be added on and you get taxed on the whole amount.

Really you need to at least be self assessed as the money you earn from the appstore is easy for the IRS to see as its all electronic transactions.
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Old 04-01-2013, 05:55 AM
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ThreeCubes ThreeCubes is offline
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Originally Posted by squidgyjelly View Post
Thanks for reply but I am not USA for IRS I am UK citizen and yes I have day job but I have not registered company for Iphone publishing and will stat individual publisher
SOrry for using an american sounding (irs) term we are uk too. so you should go self assessed. depending on what tax band your currently in will determine how much tax you pay on your appstore earnings.

Going self assesed can be a bit of a pain (and can effect benifts) so i guess it depends how serious you are at making money on the app store (the majority lose money). on the upside you maybe able to declare some of your development costs and house bills as a tax credit.
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Old 04-02-2013, 07:20 AM
Appvism Appvism is offline
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I'm UK based as well and registered as self employed. Thanks for the info provided in this thread, its been helpful!

However, just wondering, what if you are registered as a proper ltd conpany and registered for VAT? Does anyone know what happens then, are you able to claim anything back? My understanding is that sales tax is already deducted before you receive your cut from Apple....

Just curious really, because currently this does not affect me as i'm only registered as a sole trader and have yet to start making any money!

Cheers
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Old 04-02-2013, 11:03 AM
squidgyjelly squidgyjelly is offline
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Quote:
Originally Posted by Appvism View Post
I'm UK based as well and registered as self employed. Thanks for the info provided in this thread, its been helpful!

However, just wondering, what if you are registered as a proper ltd conpany and registered for VAT? Does anyone know what happens then, are you able to claim anything back? My understanding is that sales tax is already deducted before you receive your cut from Apple....

Just curious really, because currently this does not affect me as i'm only registered as a sole trader and have yet to start making any money!

Cheers
I too thought an individuals tax was deducted before Apple send payments.
However what happens if I make a lot and want to do the Apple thing and go through Ireland for tax to save paying a lot how to do it?
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Old 04-02-2013, 11:18 AM
psj3809 psj3809 is offline
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Quote:
Originally Posted by squidgyjelly View Post
I too thought an individuals tax was deducted before Apple send payments.
However what happens if I make a lot and want to do the Apple thing and go through Ireland for tax to save paying a lot how to do it?
I think thats mostly for large companies to dodge paying taxes ! I wouldnt risk doing anything like that. Plus you must have your own morals, i wouldnt personally try and do that, think its disgusting the way so many big companies dodge paying tax.
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Old 04-02-2013, 12:05 PM
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Blackharon Blackharon is offline
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Quote:
Originally Posted by squidgyjelly View Post
I too thought an individuals tax was deducted before Apple send payments.
However what happens if I make a lot and want to do the Apple thing and go through Ireland for tax to save paying a lot how to do it?
I think by this point you should probably employ legal advise.
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Old 04-02-2013, 01:10 PM
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ThreeCubes ThreeCubes is offline
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Quote:
Originally Posted by squidgyjelly View Post
I too thought an individuals tax was deducted before Apple send payments.
However what happens if I make a lot and want to do the Apple thing and go through Ireland for tax to save paying a lot how to do it?
Sales tax and an individuals tax are different, the sales tax ie uk vat is already paid/sorted out by apple. Your personal or company tax on profits is not. I think the vat issues does not really come up unless you were buying software and selling it on, which would never really happen on the AppStore.

Really you should work towards setting up a limited company as that way it very unlikely that you could be sued personally. Selling as an individual should only be a short term thing really.

You can claim a company is based in another country and go by that countries tax rules normally company tax on profits is 20% in the uk. Out of the profits you can pay yourself a dividend but that will be taxed to at about 25% depends on your other earning. Or you could class yourself as an employee and pay yourself though PAYEE.

It does get more complicated but I would just set up as a sole trader and change to a company once your confident you can make it on the AppStore then once your doing really well setup a company in china and pay no tax. The more money your make the easier it is to avoid tax.
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Old 04-03-2013, 05:33 AM
squidgyjelly squidgyjelly is offline
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I appreciate all inputs but how do you pay no tax with a China company and can this also be done or similar in Thailand or Philippines in which Iintend to move to if I ever make good profits?
And what if I leave my money in a UK bank and withdraw in Thailand, China or Philippines via ATM?
Quote:
Originally Posted by ThreeCubes View Post
Sales tax and an individuals tax are different, the sales tax ie uk vat is already paid/sorted out by apple. Your personal or company tax on profits is not. I think the vat issues does not really come up unless you were buying software and selling it on, which would never really happen on the AppStore.

Really you should work towards setting up a limited company as that way it very unlikely that you could be sued personally. Selling as an individual should only be a short term thing really.

You can claim a company is based in another country and go by that countries tax rules normally company tax on profits is 20% in the uk. Out of the profits you can pay yourself a dividend but that will be taxed to at about 25% depends on your other earning. Or you could class yourself as an employee and pay yourself though PAYEE.

It does get more complicated but I would just set up as a sole trader and change to a company once your confident you can make it on the AppStore then once your doing really well setup a company in china and pay no tax. The more money your make the easier it is to avoid tax.

Last edited by squidgyjelly; 04-03-2013 at 05:35 AM..
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