Quick Summary
- Since 2024, platforms such as Vinted, eBay, Etsy, Airbnb and Uber report sellers' earnings to HMRC.
- Being reported doesn't automatically mean tax is due.
- Selling your own unwanted personal items usually isn't taxable income.
- Buying to resell, or making things to sell, is usually trading.
- The first £1,000 of trading income is covered by the trading allowance.
If you sell on Vinted, eBay, Etsy, Depop or rent out a room on Airbnb, you may have heard that "HMRC is coming after online sellers". The reality is more nuanced: platforms now share information, but many sellers still owe nothing. Here's how to tell whether you need to pay tax.
What changed?
Under the digital platform reporting rules, which started on 1 January 2024, online platforms must collect sellers' details and report their earnings to HMRC each year. Platforms report sellers who make 30 or more sales or earn about £1,700 (€2,000) or more in a calendar year. You should get a copy of what's been reported.
This is a reporting rule, not a new tax. Whether you owe tax still depends on what you are selling and why.
Decluttering or trading?
Selling your own unwanted items — usually not taxable
Clearing out your wardrobe, selling a child's outgrown toys or your old phone isn't trading. You normally sell these for less than you paid, so there's no profit to tax. Capital Gains Tax only becomes relevant on individual items sold for more than £6,000 that have gone up in value.
Buying to resell or making items to sell — usually trading
HMRC looks at the "badges of trade", including:
- Are you buying items with the intention of selling them at a profit?
- Do you make or customise items to sell?
- How often do you sell, and is it organised like a business?
- Do you repair or improve items before selling them?
Charity-shop flipping, dropshipping, handmade crafts on Etsy and regular resale on eBay are all likely to be trading.
The £1,000 trading allowance
If your total trading income (before expenses) from all side activities is £1,000 or less in a tax year, it's covered by the trading allowance — you don't need to tell HMRC or pay tax on it. Above £1,000, you need to register for Self-Assessment and can deduct either £1,000 or your actual expenses, whichever is better.
There's a separate £1,000 property allowance for income such as letting a parking space or occasional short lets. Renting a furnished room in your own home may also qualify for Rent a Room relief, which covers up to £7,500 a year.
What expenses can resellers claim?
- The cost of items you bought to resell
- Platform and payment fees
- Postage and packaging
- Materials for handmade items
- A proportion of phone and internet costs
I've been reported. What should I do?
- Check the figures the platform reported against your own records.
- Work out whether the sales were personal items or trading.
- If it was trading over £1,000, register for Self-Assessment and include it on your return.
- If you should have declared income in earlier years, consider a voluntary disclosure — penalties are lower when you come forward first.
If you have a job as well, your side income is added to your salary, so it may be taxed at a higher rate than you expect.
Frequently Asked Questions
Do I have to pay tax on Vinted sales?
Not if you're just selling your own unwanted belongings for less than you paid. If you buy items to resell or make items to sell, that's usually trading, and income over £1,000 a year needs to be declared.
Does eBay report to HMRC?
Yes. Under the digital platform reporting rules, eBay and other platforms report sellers who make 30 or more sales or earn about £1,700 or more a year.
What is the £1,000 trading allowance?
It lets you earn up to £1,000 a year from trading without telling HMRC. Above that, you register for Self-Assessment and deduct either £1,000 or your actual expenses.
Will I get a tax bill just because the platform reported me?
No. Reporting doesn't create a tax bill by itself. Tax is only due if you're trading and your income is above the allowance.
Do I pay tax on Airbnb income?
Usually yes, if it's above the £1,000 property allowance. If you rent a room in your own home, Rent a Room relief may cover up to £7,500 a year.
Reported by a Platform?
We'll check whether you're trading, what (if anything) is owed and put your tax return or disclosure right.
Sardar Muhammad, AAT
Sardar is the founder of LimeTree Accounting Solutions, an AAT-accredited practice in Govanhill, Glasgow. He works with sole traders, tradespeople, landlords and small limited companies across Glasgow and Clydebank.
This guide is general information based on UK and Scottish tax rules as at 13 October 2026. It is not personal advice. Rates and thresholds change, so speak to us about your own situation.