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Subject: are pledges in kickstarter taxable incomes in UK? rss

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Manuel David Cruz
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Hi all,

I'm working in a forthcoming project in kickstarter but I have the following doubt: are the pledges taxable incomes in United Kingdom?


thanks!
 
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Charles Vasey
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manuel3086 wrote:
Hi all,

I'm working in a forthcoming project in kickstarter but I have the following doubt: are the pledges taxable incomes in United Kingdom?


thanks!


It will probably depend where the receiving business is resident.
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Joe Mucchiello
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Consult a tax accountant (or the UK equivalent). Any answer you get here may or may not be right.
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Charles Vasey
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jmucchiello wrote:
Consult a tax accountant (or the UK equivalent). Any answer you get here may or may not be right.


He just did.
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Koen Hendrix
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I'm not an accountant, but I believe pledges to be taxable income, yes. To create a UK kickstarter you need a UK address and UK bank account, and either be a UK resident or a Companies House registered business.
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Manuel David Cruz
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Thanks for your answers!

Charles Vasey wrote:

It will probably depend where the receiving business is resident.



The receiving person resides in Wales.
 
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Charles Vasey
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manuel3086 wrote:
Thanks for your answers!

Charles Vasey wrote:

It will probably depend where the receiving business is resident.



The receiving person resides in Wales.


Has (s)he commenced trading yet, or is this project held in a separate entity?
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Manuel David Cruz
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Charles Vasey wrote:

Has (s)he commenced trading yet, or is this project held in a separate entity?



This is her first crowdfunding and she is going to help me to edit my first boardgame. The idea is: she will give me the earned money and I'll edit the game. I'm from Spain and I can't make a KS project. Neither she nor me have any trading job.
 
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Joe Mucchiello
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That sounds like potentially a big legal mess. What will she do when your KS earns $100,000 and she has to report it on her taxes? You both should hire lawyers or incorporate and hire one lawyer in addition to an accountant.
 
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Charles Vasey
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manuel3086 wrote:
Charles Vasey wrote:

Has (s)he commenced trading yet, or is this project held in a separate entity?



This is her first crowdfunding and she is going to help me to edit my first boardgame. The idea is: she will give me the earned money and I'll edit the game. I'm from Spain and I can't make a KS project. Neither she nor me have any trading job.


So she will not be the legal entity making or selling the game? She is just the collecting agent. She holds the funds on your behalf and then transfers them?
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Manuel David Cruz
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Charles Vasey wrote:

So she will not be the legal entity making or selling the game? She is just the collecting agent. She holds the funds on your behalf and then transfers them?


Excuse me, my limited English language level don't allow me explain all I would like.

It will be a little more difficult. I'm going to create an editorial but it doesn't exist yet. She will collect the money on its behalf and then transfers it to it. Is it possible? She won't be the legal entity making or selling the game. Of course this is only an idea and we don't want to break any law.
 
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Charles Vasey
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manuel3086 wrote:
Charles Vasey wrote:

So she will not be the legal entity making or selling the game? She is just the collecting agent. She holds the funds on your behalf and then transfers them?


Excuse me, my limited English language level don't allow me explain all I would like.

It will be a little more difficult. I'm going to create an editorial but it doesn't exist yet. She will collect the money on its behalf and then transfers it to it. Is it possible? She won't be the legal entity making or selling the game. Of course this is only an idea and we don't want to break any law.


If she is not trading in the UK (and you say she is not making or selling the game) and the funds are held on behalf of a Spanish individual/entity and then transferred to that individual/entity then they should not be treated as income. She is just an account through whom the funds pass and has no trading function.

You need to ensure you have a good document trail here.
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Manuel David Cruz
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Charles Vasey wrote:

If she is not trading in the UK (and you say she is not making or selling the game) and the funds are held on behalf of a Spanish individual/entity and then transferred to that individual/entity then they should not be treated as income. She is just an account through whom the funds pass and has no trading function.

You need to ensure you have a good document trail here.



Thank you very much Charles. I understand what you want to say. We'll try to have a good document trail.

I don't understand why KS doesn't allow other countries, like Spain or Germany or France, to carry out projects.
 
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Jake Staines
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manuel3086 wrote:

I don't understand why KS doesn't allow other countries, like Spain or Germany or France, to carry out projects.


They're probably still working out the tax implications! ;-)
 
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Charles Vasey
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Bichatse wrote:
manuel3086 wrote:

I don't understand why KS doesn't allow other countries, like Spain or Germany or France, to carry out projects.


They're probably still working out the tax implications! ;-)


We have a Winnah!
 
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LudiCreations
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Charles Vasey wrote:
Bichatse wrote:
manuel3086 wrote:

I don't understand why KS doesn't allow other countries, like Spain or Germany or France, to carry out projects.


They're probably still working out the tax implications! ;-)


We have a Winnah!


They don't do this in other countries mainly because Amazon Payments is not available in other countries. Also, because of the language barrier, and because laws in those countries may see crowdfunding as a "collection", and therefore not entirely legal. And, in the case of Germany, most certainly some tax implication as well. Although, there is already Startnext there...
 
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