Thursday, May 22, 2008

Making It Official

No, I'm not getting married! I am busy making something else official: My business!

I never knew how much work that would be. I wish it was just sending a form to the business registry, but a lot more is involved. There's taxes to think about, so I need to register for that, and figure out how to charge my customers. I wish it was just Holland I had to worry about, but apparently I need to pay (and charge) taxes for customers from all of Europe. It's 19% here too. Ouch.

And then there's the disability problem. I get an allowance, so I need to contact them, and tell them how much profit I expect to make (if only I knew!), how many hours a week I work, etc. It's all pretty complicated, because I never work the same amount of hours, simply because I never know how my head will be. And what is considered working? My blog and blog reading does give my shop exposure, but is that marketing and thus working? Or is it just a hobby that happens to bring me business too?

Has anyone of you made their business official? When did you decide it was time for that? And does anyone live in a state or country that makes you charge sales tax? If yes, how did you handle it? Do you add it to all of your prices, or do you only charge people from your own country or state? And how do your customers react to having to pay more? Did you lose any business when you started charging sales tax? I'm really not looking forward to adding 19% to all of my products. I think I might just have to lower my prices a bit first, even though I only just raised them because I was undercharging.

Why does it have to be this complicated?

5 comments:

  1. Congrats on taking that next big step! Those taxes sound like a nightmare! I'm sure you'll receive some good advice from someone about taxes that has a better understanding about that than me. I'm clueless I'm afraid. I do think that you could say that your blog is a form of marketing so you could certainly claim those hours. Unless of course by doing that it will have a negative impact on your allowance. If that's the case you should state that it is a hobby. Just what I think. You don't want your benefits to decrease, especially during the 'start-up' phase of your business. Best of luck with it all. Not that you'll need it. It will all be super good :)

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  2. YAYYY--- GOOD FOR YOU! :)

    I'd love to help if you need ANYthing--- let me know! :)

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  3. Good for you! But it does involve some not-so-fun work. Did you see my post on the DIY Scene forum where someone asked about taxes? I got Sales Tax ID this year but it's only for New York State and every county in NY has a different tax rate so that's a little annoying.

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  4. i made my business "official" as soon as i found out that i am supposed to charge all texas customers (as i live in texas, usa) sales tax. this was... i think like a month after i opened up shop on etsy. the tax in texas is 8.25%, but since hardly any of my customers are in texas, i decided (and i say this in my shop policies) that i'm just going to pay the sales tax for a customer who's in texas. the state sends quarter-yearly statements, and i have to fill out all my business income info, and pay the tax based on how much of my income came from texas customers. so far, i've only had to shell out $6, so it's not so bad, and i think my texas customers appreciate not having that "hidden" fee :).

    that sucks that you have to charge 19% tax to anyone in europe! wow. that's really high. but your stuff is so cute, i bet a 19% price increase will barely phase your customers :). it's not like your stuff is expensive to begin with, so that's good. good luck, tizz!

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  5. We registered our business right away. It was semi-complicated, but not a huge deal.

    As far as sales tax goes, for us, we only pay sales tax (6.5%, not much) for customers within our own state. We have PayPal set up to charge them the sales tax, and make it clear in our shop policies.

    Cute new glasses!

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