From 2025, HMRC began receiving a wealth of online data concerning sales and those who make more than 30 transactions per year
Countless people across the UK use platforms like Vinted, eBay, and Etsy to make some quick cash online. However, users who make more than 30 sales annually should be aware of specific HMRC rules to avoid penalties.
Lee Murphy, managing director of The Accountancy Partnership, discussed these crucial regulations with the Mirror. While it’s easy to lose track of online earnings, he advised sellers to maintain detailed records to avoid future problems.
“HMRC uses data provided by the platform, whether this is Etsy, Vinted or even eBay, to match against each individual’s tax records,” Mr Murphy said. “Those who’ve exceeded an annual trading allowance of £1,000 and also fail to declare this may receive reminder letters to ensure that they get their tax return done.
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“While you may think this is just a scare tactic, ignoring these types of letters may lead to further full tax inquiries and criminal investigations.” From 2025, HMRC began receiving a wealth of online data concerning sales for those who make more than 30 transactions per year or earn roughly £1,700 annually on platforms.
This sharing of sales data does not automatically mean an individual needs to complete a Self-Assessment tax return. However, the following people are included among those who do:
- Those who buy goods for resale or make goods with the intention of selling them for a profit.
- Those who offer a service through a digital platform, such as being a delivery driver or letting out a holiday home through a website.
- AND those generate a total income from trading or providing services online of more than £1,000 before deducting expenses in any tax year.
In sum, a Self-Assessment form is a tool HMRC uses to collect income tax. While tax is usually deducted from wages and pensions through an automatic PAYE system, some people receiving income from external sources must complete these Self-Assessments.
Nonetheless, Vinted has explained that if the money you make on the platform over a year is less than what you paid for the items, you pay no tax. Its current online advice reads: “The UK reporting rules for digital platforms require platforms like Vinted to provide sellers’ information to HM Revenue & Customs (HMRC). If you make a certain amount of sales on Vinted, you’ll need to complete a seller report for HMRC.
“Completing a seller report and sharing information doesn’t mean there’s an obligation to pay taxes on your Vinted sales. HMRC reporting also doesn’t require you to do anything new regarding your taxation obligations.”
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Beyond keeping track of item sales, Mr Murphy also advised noting down further associated expenses, such as stamps, postage materials and courier payments. If you are required to complete a Self-Assessment form, this may potentially help you retrieve some funds.
He continued: “If you are selling unwanted personal items and not making repeat trades or dropshipping, then you’re unlikely to face HMRC scrutiny.
“If you do, however, earn over £1,000 from your side hustle each year, or you exceed 30 sales within one year, then you must let HMRC know about this to avoid getting any fines or being under any sort of criminal investigation.
“If you’re unsure how many items you’ve sold or how much money you’ve made so far, then it’s best to go back and find your detailed sale records. Also keep track of any expenses that’ve gone with the sales; stamps, postage materials and courier payments, as you could get some of this back when the time comes to doing your Self-Assessment tax form.”
If you’re unsure how much tax you should pay for selling items online, you can also use this tax calculator here.
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