Selling Online

Following on from the announcement that HMRC are now receiving details of the income received from online holiday booking websites like Airbnb (see earlier Blog- Tax crackdown on Airbnb hosts), HMRC are now also receiving details of all income received from online marketplaces.

This has had many people asking the question ‘Do I need to pay tax on selling my clothes or other unwanted items on Vinted or eBay?’

The rules for declaring income and paying tax on the income has not changed but from 1 January 2024, the digital platforms are mandated to give the information automatically.

If you sell unwanted goods or clothes online (‘side hustles’) then it is unlikely that you will be classed as trading and constitute a taxable transaction. However, if you are buying stock to resell at a profit then this is likely to be considered trading and tax liabilities may arise.

There is a ‘trading allowance’ available which is a tax exemption of up to £1,000 a year for individuals.  This can be offset against any self-employed income which means if your gross income is less than £1,000a year you do not need to tell HMRC.

If you think you may be classed as trading and are not reporting your income to HMRC then please contact us to discuss further.