Hi everybody. I run a part time carpet cleaning business and occasionally steam clean lounges for friends who find them on the side of the road or buy them of those Facebook buy pages. We have picked a few up off the side of the road and steam cleaned them and unsold them to friends for a juicy profit etc. Just wondering how we could incorporate this into our business sales? We were looking at beginning to buy them of those pages clean them and on sell them for a profit. As these are people personal items they are not doing receipts for them obviously how would we go if we bought one for $100 and on sold it for $300? Hate to have to pay extra tax and I don't want to be dodgy and do it cash in hand as we would like to borrow through the business in the near future. Also sorry for the terrible thread title couldn't think of anything better
You can run something like that through the books, pay tax and borrow against the income in the future. My mate was doing something similar in Perth, buying essential oils from the eastern states and onselling them to retailers in Perth. Purchasing the essential oils and shipping was basically the only expenses. The rest was profit. He had all the accounting done properly, paid the tax and borrowed against the income. The tax wasn't that much.
How would it work though from the on selling aspect. Do I just foot the purchasing with my own personal money. If that make sense so for example I buy a lounge for $50 steam clean it and on sell it for $250 my profit is really $200 but wont I get taxed on $250
You may need to get a second hand dealers licence as you would be operating in a similar fashion to a 2nd hand dealer - pay someone cash for lounge (issue a payment slip for your own records).
