Tax for online sellers

HMRC has been publicising the tax treatment of income for online sellers on websites such as eBay and Vinted as the platforms start sharing their sales data with HMRC from January 2025. The announcement comes as online platforms start sharing sales data with HMRC from January 2025, a new process that when announced last year, generated claims that people would have to pay tax when they sold their unwanted items online.

If you are unsure if your additional income could be taxable, just search ‘online platform income’ on https://www.gov.uk/guidance/check-if-you-need-to-tell-hmrc-about-your-income-from-online-platforms to use HMRC’s free online tool or download the HMRC app and go to the ‘news’ section under the ‘communication’ tab for more information.

Angela MacDonald, HMRC’s Second Permanent Secretary and Deputy Chief Executive Officer, said:

“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.

The new reporting requirements for digital platforms came into effect at the start of 2024. It is not a new tax and whether people are selling personal items on eBay, renting homes out on Airbnb or delivering takeaways through Just Eat no tax rules have changed.” 

Those who sell at least 30 items or earn roughly £1,700 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.

The sharing of sales data does not automatically mean the individual needs to complete a tax return. However, those who may need to register for self-Assessment and pay tax, may include those who:

• buy goods for resale or make goods with the intention of selling them for a profit
• offer a service through a digital platform such as being a delivery driver or letting out a holiday home through a website
• AND generate a total income from trading or providing services online of more than £1,000 before deducting expenses in any tax year.

Further information

If you have any questions or are in doubt about whether this will affect you, please get in touch with your Swindells partner who will be able to assist you further.