If you sell on eBay, Vinted, Depop, or any other UK marketplace, you've probably seen the phrase "side hustle tax" somewhere in the last couple of years. It's a misleading name: no new tax has been introduced. What's actually changed is that HMRC now gets your sales data directly from the platforms, so it's much easier for them to notice if your Self Assessment return doesn't match reality.
Here's what UK resellers actually need to know.
The £1,000 trading allowance
Every tax year (6 April to 5 April), you can earn up to £1,000 in trading income without reporting it to HMRC at all. This is the trading allowance, and it's combined across every platform you sell on — eBay, Vinted, Depop, Facebook Marketplace, in-person sales, all of it counts toward the same £1,000, not £1,000 per platform.
Stay under that combined total and there's nothing to file. Go over it, and the whole amount needs to be reported through Self Assessment, though you only pay tax on the profit above your other allowances, not on the full sales figure.
Selling your own stuff vs. trading
The trading allowance only applies to trading income. If you're clearing out your wardrobe and selling things on Vinted for less than you paid for them, that's not trading — it's decluttering, and it isn't taxable regardless of how much you make. There's no gain, so there's nothing to tax.
The line moves once you start buying stock specifically to resell it, whether that's charity shop flips, wholesale lots, or anything sourced with the intent of making a profit. At that point HMRC treats it as a trade, and it's the trading allowance and Self Assessment rules that apply, not the personal-possessions exemption.
What actually changed with marketplace reporting
Since January 2024, digital platforms operating in the UK — eBay, Vinted, Depop, and similar marketplaces — have been legally required to report seller activity to HMRC once a seller crosses roughly 30 sales or about £1,700 in a calendar year, whichever happens first. This followed an international agreement (OECD DAC7) that the UK and dozens of other countries adopted together, so it isn't unique to any one platform.
What this means in practice: HMRC now has an independent record of what a lot of active sellers are actually earning, separate from whatever gets reported on a Self Assessment return. If the two don't line up, that's the kind of mismatch that triggers a compliance check. It doesn't create a new tax obligation — the trading allowance and Self Assessment thresholds are unchanged — but it does mean under-reporting is far easier for HMRC to catch than it used to be.
Registering for Self Assessment
If your trading income for the tax year goes over £1,000, you need to register for Self Assessment with HMRC by 5 October following the end of that tax year. Miss the registration deadline and you can face a penalty even before the tax return itself is late.
Once registered, you'll file a Self Assessment return each year declaring your trading income and expenses, and pay any tax owed by the following 31 January. From the 2027/28 tax year, HMRC plans to introduce a simplified reporting process for trading income between £1,000 and £3,000, so smaller resellers won't need a full return — but that hasn't started yet, and the current rules still apply now.
Keeping track of sales, fees, and costs across multiple platforms? QuickBooks tracks your income and expenses automatically as you go, so you're not reconstructing a year of eBay and Vinted sales from memory when your Self Assessment deadline arrives.
What counts as a deductible expense
Once you're trading and past the £1,000 allowance, you're taxed on profit, not on gross sales. Costs that reduce your taxable profit include:
- What you paid for the stock you sold
- Platform and payment fees
- Postage and packaging
- A reasonable share of home costs if you work from home regularly
- Mileage for sourcing trips and post office runs
- Any software or subscriptions used to run the business
Keeping receipts and a running record of these as you go is far easier than trying to reconstruct them from bank statements in January.
Shipping and your margin
Postage is one of the biggest recurring costs for UK resellers, and it's fully deductible against trading income. See the cheapest way to ship parcels in the UK for how to keep that cost down across different couriers and comparison sites.
Frequently asked questions
Do I have to pay tax on things I sell online in the UK?
Only if you're trading for profit and your total income from that trading exceeds the £1,000 trading allowance in a tax year. Selling your own unwanted personal items for less than you paid for them generally isn't taxable at all.
What is the £1,000 trading allowance?
It's the amount of trading income, combined across every platform you sell on, that you can earn tax-free each tax year without needing to tell HMRC. It's a single combined allowance, not £1,000 per platform.
Does eBay or Vinted report my sales to HMRC?
Yes. Since January 2024, UK online marketplaces have been required to report seller data to HMRC once you make more than 30 sales or earn over roughly £1,700 in a calendar year, whichever comes first. HMRC can cross-check this against your Self Assessment return.
When do I need to register for Self Assessment as a reseller?
If your trading income for a tax year (6 April to 5 April) goes over £1,000, you need to register for Self Assessment by 5 October following the end of that tax year.
Is selling my own used clothes on Vinted taxable?
No, as long as you're selling personal possessions for less than you originally paid for them. That's decluttering, not trading, and it doesn't count toward the trading allowance or Self Assessment.