HMRC warning for anyone with items listed on eBay or Facebook Marketplace

HMRC warning for anyone with items listed on eBay or Facebook Marketplace
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eBay, Vinted and Depop tax rules have been explained ahead of a key deadline within days. Under a new rule change this year, o nline marketplaces like Depop, eBay, Facebook Marketplace and Vinted are required to collect and report personal details and yearly sales transactions.

This is for the previous calendar year, in respect of sellers that meet the reporting threshold. If you do meet this threshold, this doesn’t necessarily mean you need to pay tax. Only profits from trading secondhand items are potentially taxable, so if you’re using Depop to sell your own personal possessions then you likely won’t need to pay tax.

For example, say you purchased items of clothing for a total of £3,500 in 2023 and sold them for £2,500 in 2024. Depop would have to report the £2,500 less Depop fees to HMRC, but you would have no taxable income to report since the resale amount is less than the original purchase price.

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You can earn £1,000 in additional income each tax year alongside your regular job - this is known as your Trading Allowance. If you make more than this, then you may need to pay tax and will have to register for self-assessment where you'll record your extra income to HMRC.

If you do need to pay tax, you'll have to register for self-assessment and the deadline to do this is October 5 for the 2023/24 tax year. You don’t have to declare additional income if it comes to under £1,000. If you do need to register for self-assessment, you can do so on GOV.UK or by calling the self-assessment helpline on 0300 200 3310.

Everyone’s situation is different, and it’s worth keeping records of your finances (i.e. receipts) just in case you need them at a later stage. If you have questions about your taxable income, it’s best to work with a tax professional or contact HMRC directly.