Q: I use various online marketplaces to sell my unwanted items – from clothes to old phones and various other things. I’m a bit concerned though by stories I’ve read in the media that rules are changing and I may have to start filing a tax return. That’s not something I’ve ever had to worry about before. Can you help me understand if my fears are justified?
A: There has been a lot written in the papers over the last year or so about this issue and, with the angle that we see often taken in these reports, it’s understandable that people like yourself could feel worried about the implications. Millions of people do what you do. It’s become an everyday activity to sell second hand things online.
However, HMRC has become so concerned itself about what it feels are misleading stories in the press, that it’s recently issued a long statement to try to reassure and clarify the matter.
The HMRC website stated: ‘People selling unwanted items online can continue to do so with confidence and without any new tax obligations.’
The reason these concerns have arisen is due to the fact that a new process is taking effect in January. It means online platforms have to share certain sales data with HMRC.
These new measures ‘generated inaccurate claims that a new tax was being introduced,’ officials said, adding that ‘absolutely nothing has changed for online sellers’.
However, you and others do need to be aware that if you’re buying goods for re-sale or make things with the intention of selling for profit and you garner a total income from this activity of over £1,000 in one tax year (before deducting expenses), you may need to register for Self-Assessment and fill out a tax form.
HMRC stated: ‘Those who sold at least 30 items or earned roughly £1,700 (equivalent to €2,000), or provided a paid-for service, on a website or app in 2024 will be contacted by the digital platform in January to say their sales data and some personal information will be sent to HMRC due to new legal obligations.
Angela MacDonald, HMRC’s Second Permanent Secretary and Deputy Chief Executive Officer, had this to say: ‘We cannot be clearer – if you are not trading and just occasionally sell unwanted items online – there is no tax due. As has always been the case, some people who are trading through websites or selling services online may need to be paying tax and registering for Self-Assessment.’
So, whilst it’s worth looking again at the criteria above that may mean you’re in need of registering, it sounds as though, as for many people around the country, you don’t need to be concerned or change your habits in this regard.