If you sell on eBay, Vinted, Etsy or Depop, drive for Uber, or let a room through Airbnb, HMRC receives a copy of your figures once a year without you doing anything. The platforms collect your details, add up what you were paid, and file it. This has been running since the 2024 calendar year, so HMRC is now on its third round of data.
That has produced a good deal of alarm and not much clarity. The important point is the one that gets lost: being reported and owing tax are two different things. Here is what actually happens, and how to work out which side of the line you are on.
What the platforms send, and when
The rules cover platforms that put buyers and sellers together: selling goods (eBay, Etsy, Amazon Marketplace, Vinted, Depop), letting property (Airbnb, Booking.com), personal services (Uber, Deliveroo, Fiverr, TaskRabbit) and vehicle hire.
Each platform reports your name, address, date of birth and National Insurance number, along with the gross amount you were paid and the fees deducted. They work to the calendar year rather than the tax year, and the deadline is 31 January afterwards. So what you sold between January and December 2026 reaches HMRC by 31 January 2027. You should also get a copy of what was sent about you, which is worth keeping.
There is a small seller exemption for goods, and it is narrower than most people assume. A platform does not have to report you only if you made fewer than 30 sales in the year and were paid less than 2,000 euros, roughly £1,700. Both have to be true. Thirty five sales totalling £200 still gets reported.
Being reported is not the same as owing tax
HMRC says this itself, and it is worth repeating, because the reporting threshold sits well below the point at which tax is due. Nothing about what is taxable has changed. The only thing that changed is how much HMRC can see.
Plenty of people who appear in these reports owe nothing at all. The question is not whether your data was sent. It is what you were doing.
Clearing out, or trading?
This is the whole of it. Selling things you already owned and no longer want is not a business, however many of them there are. Buying or making things in order to sell them is.
The old wardrobe going to Vinted, the pushchair the children have grown out of, the record collection, the bike in the shed: that is selling personal possessions, and there is no Income Tax on it no matter what it adds up to. You could clear £5,000 of genuine belongings and owe nothing.
Buying job lots at car boot sales to resell, making candles at the kitchen table, printing shirts to order, flipping trainers: that is trading from the first sale, even if it is small and even if it is a hobby you enjoy.
The awkward middle ground is real, and HMRC looks at the pattern rather than any one sale. How often you sell, whether you bought the item with selling in mind, how much you changed it, how you advertise, and whether you are doing it to make a profit. Someone who bought a bike for themselves in 2023 and sells it in 2026 is clearing out. Someone buying broken bikes, fixing them and selling them every month is trading. Most cases are more obvious than the worrying suggests.
One point that catches people: if you are trading, the £1,000 trading allowance is measured on gross income, before your costs come off. Sell £1,400 of goods that cost you £1,100 to buy, and you have made £300 but you are over the line and you have to report it.
The capital gains corner
Selling your own possessions is outside Income Tax, but very valuable items can bring in Capital Gains Tax. The rule is generous. If you sell a personal possession for £6,000 or less, any gain is exempt, and that is on the sale price rather than the profit. Private cars are exempt whatever they sell for. Above £6,000 the calculation matters, and a set sold in pieces counts as one item.
For the overwhelming majority of people emptying a loft, this simply never arises. It is worth knowing if you are selling inherited jewellery, art or antiques.
If you let a room or a property
Different allowances apply here. Letting a furnished room in the home you live in falls under the Rent a Room scheme, where the first £7,500 a year is tax free and there is nothing to report below that. Letting somewhere you do not live, including a holiday let, is covered instead by the £1,000 property allowance, which is a much lower bar. You cannot use both against the same income.
Airbnb hosts often assume the £7,500 figure covers them and find it does not, because the property is not their own home.
If a letter arrives
HMRC writes to people whose reported figures do not match what it expected to see. These letters are prompts rather than accusations, and they are not the same as an enquiry.
Do not ignore one. Work out honestly what the sales were. If it was genuinely your own belongings, say so and be able to show it. If it turns out you were trading and should have registered, come forward yourself rather than waiting. For a failure to notify, the penalty range starts at nothing where you volunteer it, and at 10 per cent where HMRC finds you first. Owning up promptly is usually free.
If you need to register for the 2025 to 2026 tax year, the date to know is 5 October 2026, and our guide to registering for Self Assessment covers who is caught.
What changes next
Two things are worth having in mind.
From April 2027 the Self Assessment reporting threshold for trading income rises from £1,000 to £3,000 of gross income, with a simpler online service for people below it who still owe some tax. That is the 2027 to 2028 tax year, so it does nothing for the return you are filing now. Note also that it is the reporting threshold that is moving, not the £1,000 trading allowance itself, which stays where it is.
And if a side business grows, Making Tax Digital for Income Tax comes into view. The threshold drops to £30,000 of gross income from self-employment and property in April 2027, and £20,000 in April 2028. Gross income again, not profit, and the two are added together, so a modest shop plus a rental can reach it sooner than either would alone.
Where we come in
Most people who ask us about this turn out to owe nothing, and the useful thing we do is say so plainly and explain why. Where there is a real business underneath, we register you, work out what is actually taxable, claim the costs you are entitled to, and file the return in good time rather than in the last week of January.
Our Sole Trader service is £62.50 per month, fixed, with no extra charge for picking up the phone when a letter lands and you would like someone to look at it.
If a side line has grown into something you would rather have handled properly, Get your instant quote and see your fixed monthly fee in under a minute.