Accounting and Bookkeeping for Ebay Traders

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Training Book and Downloads

There is a complete eBay Start-Up Do It Yourself Bookkeeping complete training manual available with Cloud links to free downloads of Cash Book forms and easy already formatted bookkeeping Analysed Cash Book spreadsheets, also  in the downloads.  The Kindle book is available from Amazon uk for about £12  which includes all the free Cash Book forms and spreadsheets. The manuals also can include details about how to use on line Cloud systems where you can see your 'books' on the go by mobile phone.  They also make your tax return easy with tax form reports.  See my book and download kit on Amazon UK, eBay Start-Up Bookkeeping.  

Bookkeeping is simply making a new record about a money in or money out transaction, often starting with a source record such as a bank or PayPal statement where income and purchases transactions are recorded when they take place.

Once you have got your Bank or PayPal statement then the next step in bookkeeping is to enter a new record about each transaction into your books using a Cash Book form like the one below.  Here you can see a Cash Book form that comes with the book.  There are some typical eBay trader transactions recorded her for the last  week in the month, including a telephone bill, some eBay postage and packaging paper, plus the eBay listing fees (advertising), personal bank current account fee and then some allowances using the new HMRC system of just using a set mileage rate for business travel, to car boot sales or the post office and then finally the home use 'hourly' allowance.

You always enter the transactions dated when they were paid as a 'cash basis' sole trader. But that 'cash basis' does not mean that you only use cash in your business. It means that you enter the actual date bills were paid in your Cash Book record n- even though you may be doing your Cash Book a month later when you get the bank statement.   So if your bank statement shows that you paid your eBay invoice for listing and Final Value Fees on 20th October then you enter that date as the date of the transaction in your Cash Book form that month.   That is slightly different from a Limited Company that would use 'accrual and prepayment basis' where the eBay basic business subscription is paid in advance and would go in the books as a prepayment and so the month of October does not get charged with the subscription. It gets charges in November. 

You just keep a set of the original records for each transaction in a set of two Lever Arch Files ( one for purchases in date order and one for sales invoices in invoice number order) and do these Cash Book forms every week.  Purchase invoices can be a till receipt or a petty cash slip if you buy from car boot sales, or an invoice. You need to print out and send your customers a sales invoice with each delivery of goods to them.
Do It Yourself Bookkeeping Manuals have free Cash Book forms to use for bookkeeping, but you need to do the adding up yourself. Notice that the Cash Book has 'Categories' to enter a record about each transaction into. So Postage is a category.

These HMRC 'Allowable Expenses' categories help you to save tax by recording expenses in 'allowable - tax free- categories.  In this Cash Book form the new HMRC 'Simplified Expenses' are used.  This saves the sole trader from having to work out how much of the home rent or mortgage,  insurance, heating and light was used by the spare room where the eBay business lives. And the same for car/van use and insurance, tax, repairs.   Just keep a mileage record.    

With a free Analysed Cash Book spreadsheets you save time since the spreadsheet has drop down boxes with expense categories that automatically add up the expenses in each HMRC 'Allowable Category'.  

What is great about an Analysed Cash Book Spreadsheet is that every time you enter a bookkeeping record about a transaction the spreadsheet automatically does all the sums  and adds up the income and expenses and produces a profit and loss statement.

These free trial Cloud systems take Do It Yourself bookkeeping to another level of ease.  You do not need to be able to manage a spreadsheet. You enter a record in a page. The system can even import your bank statement automatically!

These 'Modelling 'spreadsheets allow 'what if'  modelling of different selling prices or costs or sales volumes. You instantly see the effect on profits, and can then make decisions on discounts or new products. 

 
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