Business status, income and banking

The £1,000 trading allowance

In the UK, an individual can earn up to £1,000 of gross trading income in a tax year (6 April to 5 April) without needing to register as self-employed or file a Self Assessment return for it. That £1,000 is turnover before costs, not profit — so advertising income counts in full even if hosting bills eat most of it.

Once gross trading income passes £1,000 in a tax year, HMRC registration as a sole trader is required. The deadline is 5 October following the end of that tax year, and the income is then reported through Self Assessment.

Money raised through a crowdfunding campaign is treated differently depending on what backers get in return. Where pledges fund the business and backers receive rewards, it can count as trading income — worth confirming with an accountant before the first payout lands.

Why register early, even under £1,000

• You can deduct real costs — hosting, domains, design, moderation tools — instead of using the flat £1,000 allowance, which usually helps once costs are meaningful.
• Early-year losses can be recorded and set against later profits, which is common while a project is still growing.
• Advertisers, sponsors and payment providers generally expect a business identity, an invoice address and a business bank account.
• The legal pages can state a settled, registered position rather than an interim one.

Personal or business bank account?

A sole trader is legally the same person as the business, so a separate business account is not a legal requirement. In practice a separate account is strongly worth having once any income starts arriving:

• Income and expenses stay separated from personal spending, which makes Self Assessment far quicker and evidences the 50% charity split cleanly.
• Most personal current account terms — HSBC's included — restrict or prohibit business use, so regular commercial payments into a personal account risk problems with the bank.
• Ad networks and payment providers often require an account in the business or trading name before paying out.
• A second personal account is a poor substitute; a business account gives proper statements, an invoiceable name and access to bookkeeping integrations.

A reasonable sequence: keep everything as it is while nothing is being earned, register with HMRC as soon as income is realistically approaching £1,000 (or sooner if you want to claim costs), then open a business account in the trading name before the first advertiser or supporter payment.

Charity money

The 50% profit commitment — all of it to Cancer Research UK — is tracked in the ledger described on where the money goes. The Good Retreat is not a charity and does not collect donations on a charity's behalf; payouts are made from business profit.