06/01/2024

Martin Lewis Urges Vinted and eBay Sellers: Make Urgent Checks Now to Avoid Costly Consequences

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Renowned financial expert Martin Lewis has issued a crucial warning to sellers on popular online platforms Vinted and eBay.

Lewis, known for his consumer advocacy and financial advice, is urging sellers to conduct immediate checks that could potentially save them thousands of pounds.

Lewis’s latest concern stems from a new crackdown by Her Majesty’s Revenue and Customs (HMRC), targeting sellers who may be unknowingly skirting tax obligations. In this article, we delve into the implications of this HMRC tax crackdown and Lewis’s urgent advice for eBay and Vinted sellers.

At the beginning of 2024, HMRC announced it’d be tightening up the rules on people’s side hustles such as selling second hand goods online or renting out a property with Airbnb. HMRC’s recent initiative aims to bring greater transparency to the online marketplace, with a specific focus on individuals selling goods through platforms like eBay and Vinted. The tax crackdown is designed to ensure that sellers are fully aware of their tax obligations and are reporting their earnings accurately, contributing their fair share to the national tax revenue. eBay and Vinted and other similar selling sites will be required to share how much you’re earning on these sites to HMRC.

However, Martin Lewis and his team have got all the info you need to know and for most it’s likely not to affect them at all.

Martin Lewis urged people to look at how much money they were making from these type of sites, because if it is below £1,700 or there were less than 30 items being sold then nothing will really change.

His site says that you should check if you need to pay any tax, but that most were likely not going to have to pay over any extra money to HMRC.

Essentially, the change is that HMRC is moving from being able to see sellers information for these online trading companies when it asks to, to now getting it automatically.

Your details only get passed on automatically if you’re selling 30 or more items a year or make over €2,000 (£1,724) from selling your stuff.

Tax obligations may come into play if your earnings from selling surpass £1,000, as individuals benefit from a tax-free allowance of that amount for ‘trading’ transactions.

However, the average person merely selling some pre-owned clothes on Vinted is unlikely to meet the criteria for being classified as ‘trading,’ potentially exempting them from taxation. Plus, engaging in the creation or purchase of items with the explicit intent to sell suggests a trader status but on the other hand, selling items that have been gathering dust in your garage may not qualify.

According to information on Lewis’ website, if your annual income from selling second-hand items online is £1,000 or less, you may not be required to pay additional tax or engage with HMRC. It’s important to note that the £1,000 figure is somewhat misleading, as it represents the income before the platform deducts its share, not the amount remaining after the transaction.

For those earning beyond £1,000, it might be necessary to inform HMRC and fulfill tax obligations. However, the majority of individuals using platforms like eBay and Vinted are unlikely to fall into this category.