eBay & paying tax: 30+ sales.

B0bbyEwing

Having had my tax code changed recently due to my savings putting me over the 1k threshold, within days of this I had a relative asking me of eBay & tax.

Basically they got notification saying eBay will be reporting him (to HMRC?) for selling 30 or more items or exceeding £1707 within a calendar year.

He's sold 32 items & his year to date total sat at £1090 when he text me this.

So question is, like myself - is his tax code going to change now because he's triggered some threshold? As in does it automatically get handled through his payslip or is he going to have to start paying whatever fees via eBay?

As is usually the 'more to it than that' case … all he's done is stripped a vehicle down and sold as parts rather than scrap the vehicle. In the end pretty much everything sold bar the shell & 4 wheels it sat on. Much was done through Marketplace to avoid any fees but some stuff ended up going through eBay.

As he's wanting to know whether to stop selling on eBay & switch back to Marketplace now or whether he's not (yet) going to be hit with a tax bill.

And I'm assuming creating a new eBay account to sell wont work? Can't blame someone for asking so I'll ask anyway :)

Dazed_and_C0nfused

No, if he has a business selling things via eBay and his turnover is more than £1,000 he will be required to complete a Self Assessment return.

Depending on how and when he completes the return for 2025/26 it may be that Amy tax owed would be collected via his tax code (it would be the code for 2027/28) but he could opt to pay HMRC direct instead and there is a box on the return he can complete which tells HMRC the preference for how the tax is collected.

Also, there is no tax in the UK on savings, presumably you mean interest from savings 🤔

vacheron

It all depends if he is trading (buying / making specifically for profit) or simply selling his old stuff.

Was this vehicle his to begin with, or did he buy it with the express intention of stripping it to sell as parts for profit?

In my example, I have had two American style fridge freezers break down in the last 10 years. Each time, I stripped it of parts and sold them separately on eBay, and both times I have made more money from doing this than the fridge originally cost me when it was new!

He can sell as many of his personal possessions as he likes without incurring any tax. (excluding capital gains which has its own specific definitions and limits). eBay are simply required to provide this info to HMRC for anyone (including myself) who exceeds these thresholds so that they can determine whether his selling profile fits the definition of trading.

Therefore saying eBay are "reporting him" is factually correct, but slightly sensationally worded, but this is how a lot of the press liked to spin it at the time this was announced.

soolin

https://forums.moneysavingexpert.com/discussion/6660701/ebay-paying-tax-30-sales

As has been said, your relative mentioning 'reporting him to HMRC' is a bit sensationalist wording, ebay, along with all online sites are now requqired to report all income over certain thresholds to HMRC.

This has been covered endlessly on here and just about everywhere for a year or so now and I'm not sure any of us are ready for another long and detailed explanation, ebay itself has a full explanation on their site as does HMRC. Basically though nothing has changed tax wise, traders are required to report income over £1000 to HMRC, they always have done, and people selling their own unwanted private items do not.