Hmrc - ebay/airbnb/vinted etc new rules - 1st Jan 2024

Thanks @Kenai and @Jono8

Although I sold the GoPro at work, it was a personal item and the intranet noticeboard does allow you to buy and sell on there. So I think I should be ok. I'm now just wary that an automated audit could flag up "false positives" on private / occasional sellers, but like with most computerised systems, they do gradually improve.
 
As people have said if you have a profile of a trader, like selling multiple lots of the same item or with a steady turnover through the year, you may be asked to justify it. If it is just one off processor and motherboard from an upgrade or your dad's vinyl collection, that should be easy to explain.
 
Hagar said:
As people have said if you have a profile of a trader, like selling multiple lots of the same item or with a steady turnover through the year, you may be asked to justify it. If it is just one off processor and motherboard from an upgrade or your dad's vinyl collection, that should be easy to explain.
Click to expand...

I have about 250 DVDs from 20 years ago that I collected. Imagine if I list all them one by one on there….although if I get £1000 total from them I’d be happy!
 
Last edited:
I make small batches of circuit boards for various hobby applications. I tend to sell off the surplus boards but ensure I don't go over the £1000 limit as the sudden extra paperwork just doesn't make it worth my while, especially as the limit is turnover rather than profit. The surplus boards then either get given away or go off to landfill. While I have no fundamental objection to the allowance rule, in many ways it seems quite sensible, the limit is so low that the jump from simple allowance to tracking income & expense makes it non viable when the costs are taken into account for the benefit derived for small scale enterprises.

As a side note, the present allowance was set in 2017 and is another example of fiscal drag. It should now be nearer £1300 if inflation is taken into account.

The rules if anyone is very bored :D

www.gov.uk

Tax-free allowances on property and trading income

Find out about annual tax-free allowances for property or trading income and if you qualify.
www.gov.uk www.gov.uk
 
softwaresimian said:
I make small batches of circuit boards for various hobby applications. I tend to sell off the surplus boards but ensure I don't go over the £1000 limit as the sudden extra paperwork just doesn't make it worth my while, especially as the limit is turnover rather than profit. The surplus boards then either get given away or go off to landfill. While I have no fundamental objection to the allowance rule, in many ways it seems quite sensible, the limit is so low that the jump from simple allowance to tracking income & expense makes it non viable when the costs are taken into account for the benefit derived for small scale enterprises.

As a side note, the present allowance was set in 2017 and is another example of fiscal drag. It should now be nearer £1300 if inflation is taken into account.

The rules if anyone is very bored :D

www.gov.uk

Tax-free allowances on property and trading income

Find out about annual tax-free allowances for property or trading income and if you qualify.
www.gov.uk www.gov.uk
Click to expand...

I have a day job - I also like messing around with audio as a hobby (I have designed and have a few 24MHz clock reference and i2s isolation PCB boards lying around). Add to that I have made a guitar and I may make some more - selling off the end guitar (probably at break even on the materials) to fund the next.

The issue is it doesn't take much (with inflation) to hit £1K. I think the woods+hardware+electronics in my guitar cost me about £800-1K due to being not your normal lumber yard junk, and if I bought wholesales this inadvertently increases the costs for over-buying to select the nicest and storage (requires humidity control and drying) for that large stock.

So you can see the £1K hits the hobbyist that's not 'trading' but doing it for mental relaxation.

A hobbyist can be a minor trader quite often but it's often a stepping stone. Also I don't subscribe to the "if it doesn't make enough profit it's probably worth dying off anyway" as it ignores the people that simply want a hobby that they can continue without it being a money pit. I don't see the problem that hobbyists make enough (tax free) that they can afford better tools.. which then pushes them to think about how they can make money which is taxed.

If you're easy trading buy-sell - that's the same as the stock exchange and to be honest if it's something that keeps you sane then I don't see a problem for that to be tax free below about 2.5-5K of cashflow (not profit).

I think overall it's a backdoor tax. Those that are attempting to make some side-money due to cost of living are being right-royally-rogered. It may be over 5 years old but still.. perhaps it's because they want to ensure the gig-economy is taxed which I can understand - my issue is the threshold being applied is prohibitive. Especially when applied to turnover and not profit.
 
Last edited:
413x said:
Yeah. If there's one thing to make me feel. Old it's the state of social media.
Its the only time I can really feel the age gap between my 20 something year old friends and the 30 somethings.

The 20s share tiktok stuff. And I do not understand. Especially the super short stuff.
Click to expand...
Eh, Vine was doing short-form stuff a decade ago, so it's not really thaaaaat new, but I'll stick to my classic early-2010s static memes thanks.
 
Resident said:
The internet wasn't a mistake. The mistake was allowing Governments to push "access for all", allowing stupid to get connected.
Click to expand...

Unfortunately it's clear to see on social media that it has allowed the thick people you attended school with to congregate together. They may be able to string a sentence together and seem plausible; this has emboldened them. They're often the ones with the latest conspiracy theories playing a large part of their content and calling anyone else sheep
 
Last edited:
Hades said:
It's seems to be annual income (not profit) of £1k or your own personal belongings on a single item worth £6k.

uwm.co.uk

Paying eBay Tax in the UK: Everything You Need to Know | UWM

Recent changes in UK tax law have made it more important than ever to know all about eBay tax. Find out how to pay your tax on eBay sales with UWM.
uwm.co.uk uwm.co.uk

I'm not sure what that second part means. If I sold a car on there for £6k but it was a car I've owned for three years then is tax still liable and for how much? Or does it just mean I need to do a self assessment (which I already do)?
Click to expand...
Tax isn't liable, it's just the threshold for reporting has changed. eBay have to stick your name on a list to send to HMRC but being on that list doesn't mean tax is due, it just means you have to contact HMRC to fill in a tax return showing that tax isn't due (e.g. profit is below threshold or not trading).
 
Jono8 said:
And how will these site's (presumably) automated systems know whether something was a personal item sold for a loss/no profit or not?
Click to expand...
They don't, which is why you have to self report, but when you report you tell them it wasn't trade and no profit means no tax. Even if you are trading, profit under £1000 also means no tax. You don't even have to keep records for costs, you can just assume a cost of £1000 so that you only declare what is over £1000 as profit.
 
Last edited:
softwaresimian said:
I make small batches of circuit boards for various hobby applications. I tend to sell off the surplus boards but ensure I don't go over the £1000 limit as the sudden extra paperwork just doesn't make it worth my while, especially as the limit is turnover rather than profit. The surplus boards then either get given away or go off to landfill. While I have no fundamental objection to the allowance rule, in many ways it seems quite sensible, the limit is so low that the jump from simple allowance to tracking income & expense makes it non viable when the costs are taken into account for the benefit derived for small scale enterprises.

As a side note, the present allowance was set in 2017 and is another example of fiscal drag. It should now be nearer £1300 if inflation is taken into account.

The rules if anyone is very bored :D

www.gov.uk

Tax-free allowances on property and trading income

Find out about annual tax-free allowances for property or trading income and if you qualify.
www.gov.uk www.gov.uk
Click to expand...

The only thing you have to track is income, if you are close to the limit you don't actually need to keep records of costs as the allowance is £1000 you can take that as your costs, so you would only have to declare what's over £1000 as profit, the amount of tax you would pay by going over a small amount would still be negligible. Filling in 2 tax returns for me and the missus takes me less than 30 minutes each year because I have a separate bank account for "business" so I just run a csv out of it and all the incoming and outgoing money is right there and all done in a minute.

It depends what your actual profit is whether it's best to take the £1000 as an allowance and actually work out your costs, or just use the £1000 so that you don't have to work out costs.

It isn't just the cost of sales either, there's all sorts of things you can put down as "costs" to minimise your profit.
 
Last edited:
You must log in or register to reply here.
Back
Top Bottom