With more and more business being conducted online, a lot of traditional retail rules have been rewritten and redefined to help accommodate this new shopping environment. As a small business owner, it can be difficult to keep track of the various new rules that need to be abided by. Something that many people are unaware of when it comes to doing business on the internet is that it's effectively the same as trading out of a storefront - especially when it comes to income tax and paying the right amount to the Inland Revenue Department. The best way to ensure you protect yourself from undue financial complications is to pay attention to each and every transaction that comes in and goes out of your online vendor. You may be wondering what the difference is between your store and someone selling something on TradeMe. Basically, it comes down to intention. You are likely to be liable for taxation if you purchased goods with an intention to resell, especially if you're planning on making a profit. This extends to services as well, in return for payment of some sort. Your income from these transactions need to be recorded and submitted as a part of your businesses taxes. This can be taken care of easily by implementing business accounting software, measured and combined with your other taxes easily. If you've been trading online without declaring income tax, it could be worth getting in contact with the IRD to discuss the options open to you. It's better to approach them and rectify the problem, rather than ignore it and have the tax become overdue - which can lead to a number of financial issues.