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Old 16th February 2005, 06:27 AM   #1

Join Date: Feb 2005
Location: indiana
Posts: 6
Default start small business or stay under the table?

Hi everyone, I'm sure this is a very redundant question but I can't find the answer I'm looking for .....
Lets say for example that someone has a side thing making and selling furniture, etc., earning under $5000.00 yearly
What are the benefits of starting a business as opposed to collecting money "under the table"?

please elaborate

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Old 16th February 2005, 07:35 AM   #2
Old Welsh Guy
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Location: Wales
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Well the obvious one is that you don't have to worry about the tax man turning up and asking you for back tax!

If your turning over 5k then by being a business you might be better off. You can offset many things against tax, like a % of the area of your house you use, % of motoring costs % of telephone costs electricity etc. And if you get into a negative value with regard tax, you can then offset this loss against the profit made from your day job.

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Old 16th February 2005, 11:15 AM   #3

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Location: Colorado, USA
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From a legal standpoint - make it an official business. From a business standpoint - make it an official business. I also think it is a mind thing. You run a business or you do some work 'under the table'? Run a business and make opportunities work.


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Old 16th February 2005, 01:18 PM   #4

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Location: Northeaster USA
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There are more legal problems that can be avoided if you run as a legit business. This can open up a world of new business for you. Many companies don;t or wont do business with somone working under the table. They expect to be able to write off the expense of your services and if the government does an audit you may be asked to explain (and Pay$$$). Keep it legit from the start.

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Old 16th February 2005, 06:58 PM   #5
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It's kind of nice to be able to buy some new expensive tools like a band saw or radial saw and write them off in your taxes as expenses of your business.

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