If you’re selling on platforms like Vinted, eBay, or Etsy, new rules mean you could be alerted if you’ve sold a certain number of items or made a set amount of money.
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This is all part of a plan by HMRC to make sure everyone is paying the right amount of tax on their extra income.
Let’s break down what these changes mean for you and how they could affect your selling.
Vinted’s new alert system
Vinted will start alerting users if they’ve sold more than 30 items or earned over €2,000 (£1,700) in a calendar year.
These alerts are part of the platform’s obligation to report certain user activity to HMRC under the new rules that kicked in on 1 January 2024.
However, this doesn’t necessarily mean you’ll owe any tax.
How does this affect you?
HMRC’s new rules are about making sure people who are making extra cash on online platforms are declaring it properly.
If you’ve been selling on these platforms as a business, it’s essential to know the tax rules.
The key number to remember is 30 transactions a year or £1,700 in sales. If you pass either of these, Vinted will flag you as potentially needing to submit a form to HMRC.
However, it’s important to understand that this isn’t a new tax.
The forms Vinted sends will mostly be pre-filled, requiring you to confirm the details and provide your National Insurance number.
Will you have to pay tax?
Just because you’re flagged, it doesn’t mean you’ll automatically have to pay tax.
You’ll only be taxed if your earnings pass certain thresholds.
For example, if you’re considered a ‘trader’—which usually applies if you’re making over £1,000 a year—you might have to pay tax on your earnings.
But if you’re selling your old items at a loss or simply decluttering your home, you’re probably in the clear.
Also, any single item sold for less than £6,000 doesn’t incur tax, and you can use your Capital Gains Tax allowance of £3,000 on profits from higher-value sales.
Clearing up confusion
There was some initial confusion about whether these new rules would mean extra taxes for people just selling unwanted items or old gifts.
The reality is that HMRC has always had the power to request this information.
The key difference now is that platforms like Vinted will automatically report this to the tax office if you pass the 30-item or £1,700 threshold.
What should you do?
If you regularly sell online, monitor your transactions to ensure you know your current position.
Remember, if you’re earning less than £1,000 from selling personal items, you won’t be taxed. And even if you’re flagged, it doesn’t automatically mean you’ll owe money.
But if you’re running an online business, make sure you declare your income and follow the proper tax rules.
These new tax reporting rules aim to catch people who might be trading online without paying tax, but the impact will be minimal for most casual sellers.
Keep track of your sales, stay informed, and you’ll have nothing to worry about.
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