HMRC has clarified the tax rules that apply when selling items online. You may have some items to sell, such as unwanted Christmas presents, or if you are starting a side hustle where you will be sending out items to your customers.
The tax rules can be confusing, as different taxes may apply depending on your specific circumstances. Asked for guidance on the issue, a HMRC spokesperson said: “As has always been the case, if you’re not trading and just occasionally sell unwanted items online, there is no tax due.
“Some people who are trading via websites, or selling services online, may need to be paying tax and register for self assessment. Our Help for Hustles campaign helps those with income from side hustles understand their tax obligations and avoid any surprises.”
The group said that people selling unwanted personal possessions through online marketplaces, such as eBay and Vinted, are “unlikely” to need to pay tax as a result.
Items that count as personal possessions include things that people to you for your own use. This could be something you purchased yourself or received as a gift.
This can include clothing, ornaments, kitchen utensils, furniture, jewellery or technology items such as computers and phones. However, if you are selling an item worth more than £6,000, you may need to pay capital gains tax.
This rule applies when you are selling a set of items that, together, form a set, such as a set of ornaments or a collection of books on the same subject by the same author.
However, if you are selling items online and earning an income, you may need to tell HMRC, and you may have to pay tax. You can use a tool on the gov.uk website to check if you need to tell HMRC about your online sales.
If you earn more than £1,000 in a tax year, you will need to register as a sole trader. You may be earning an income in this way alongside your main job, known as a ‘side hustle’.
You can find out more about what tax obligations this could involve on the ‘Help for hustles’ guidance page on the Government website. You may also benefit from downloading the HMRC app, which can help you manage your tax and other details and see any messages you have received from HMRC.
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