eBay Private Seller - Self Assessment Tax Return??

soolin

rollingmoon said:

soolin said:

Why?

Because I'm not someone who makes a living out of eBay, I'm merely using it to get rid of some accumulated clutter and I'm not familiar with the ins and outs of income tax law as applied to eBay sales. I read a newspaper article that suggests I might have to pay tax on some of the proceeds and, not being willing to take said article (or well-meaning advice on forums) at face value, I thought it best to check.

The laws are not specific to eBay, they apply to any sales, online or otherwise. 

If you buy something with an intention to resell or make something to sell then you are a business, it doesn’t matter where you sell those items. So anything online, or via a car boot or even via small ads which is sold as part of a business is potentially subject to reporting. Online of course is just a lot of easier for HMRC a to get the information with very little effort. 

Money_Grabber13579

The key message which really needs to be put out there is that you will only be subject to income tax on eBay sales if it constitutes a trade. Nothing is changing in that respect. There is a well established process which HMRC work through to determine whether someone is trading, called the badges of trade. Having said that, it’s not a black or white test, but the more badges you meet, the more likely you are to be considered trading (some are also more important than others). See the below HMRC manual:

https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim20205

The changes from 1 January are only trying to ensure that anyone who is trading, but is currently evading paying income tax on the profit, is caught. Anyone who isn’t trading has nothing to worry about (although, inevitably, some borderline cases may get caught up in correspondence with HMRC as a result).

HBelfast

Hi,

Can anyone help with a question about the new tax regulations in relation to Ebaying?

I was reading that HMRC are going to become more strict about people declaring money made from selling on Ebay and other similar sites. I understood from the article I read that if you make £1,000 or less per year from Ebaying, this wouldn't be an issue. 

I use Ebay now and then to sell clothes, shoes etc but would be lucky to bring in £1,000 per year! 

Is this something I need to be concerned about?

I'd welcome any advice or insights,

Thanks!

H

Spoonie_Turtle

If you're a private seller, just selling your own unwanted secondhand stuff, you don't need to worry about anything.

If you are trading, i.e buying or making things specifically to (re)sell, then yes if your gross receipts go over £1,000 for a tax year then you'd need to register with HMRC and do a self-assessment.

soolin

There is an ongoing thread here that might help as well

eBay Private Seller - Self Assessment Tax Return?? - Page 2 — MoneySavingExpert Forum

neogeo

Hi,
I am a private seller and have a large collection of Warhammer, Lego, games etc going back almost 20 years (some the last year or so). A change in circumstances forced me to sell a large amount last year on eBay (almost £10k), some I profited, some I lost - no records of purchase prices whatsoever...where does this leave me?

se2020

neogeo said:

Hi,
I am a private seller and have a large collection of Warhammer, Lego, games etc going back almost 20 years (some the last year or so). A change in circumstances forced me to sell a large amount last year on eBay (almost £10k), some I profited, some I lost - no records of purchase prices whatsoever...where does this leave me?

If it's a personal collection you are fine.
Tax is only due on stuff you buy and sell to make money on purpose. 

DullGreyGuy

se2020 said:

neogeo said:

Hi,
I am a private seller and have a large collection of Warhammer, Lego, games etc going back almost 20 years (some the last year or so). A change in circumstances forced me to sell a large amount last year on eBay (almost £10k), some I profited, some I lost - no records of purchase prices whatsoever...where does this leave me?

If it's a personal collection you are fine.
Tax is only due on stuff you buy and sell to make money on purpose. 

You are fine from an income tax perspective... Capital Gains is a different matter

neogeo

se2020 said:

neogeo said:

Hi,
I am a private seller and have a large collection of Warhammer, Lego, games etc going back almost 20 years (some the last year or so). A change in circumstances forced me to sell a large amount last year on eBay (almost £10k), some I profited, some I lost - no records of purchase prices whatsoever...where does this leave me?

If it's a personal collection you are fine.
Tax is only due on stuff you buy and sell to make money on purpose. 

Thanks, I'm wondering how anyone would know without asking me though as I;m not sure of what would flag someone up as a potential trader or private seller? I don't know if a years sales of £10k is considered high enough to investigate, and what is required as far as proof that it is my own collection?

neogeo

DullGreyGuy said:

se2020 said:

neogeo said:

Hi,
I am a private seller and have a large collection of Warhammer, Lego, games etc going back almost 20 years (some the last year or so). A change in circumstances forced me to sell a large amount last year on eBay (almost £10k), some I profited, some I lost - no records of purchase prices whatsoever...where does this leave me?

If it's a personal collection you are fine.
Tax is only due on stuff you buy and sell to make money on purpose. 

You are fine from an income tax perspective... Capital Gains is a different matter

So can a sale at a loss offset against a sale at a gain?
Again, I have no records so not sure I would be able to prove either way - who decides?