Answers · UK 2025/26
Does selling on eBay make me liable to pay UK tax in 2026?
Occasional private sales of personal possessions on eBay are generally not taxable. However, if you buy goods to sell for profit, sell regularly, or trade as a business, HMRC classifies this as trading income — taxable above the £1,000 trading allowance. From January 2024, eBay reports seller data to HMRC.
Full answer
**The key distinction: private sales vs. trading** HMRC distinguishes between: 1. **Private sales**: clearing out possessions you already own (old clothes, household items, unwanted gifts). Generally not taxable — you're not in business. 2. **Trading activity**: buying goods to resell at a profit, regular selling activity, or selling items you made. This is taxable as trading income. **HMRC's "badges of trade"** HMRC uses informal tests to decide if an activity is trading: - **Motive**: Did you buy the item to sell at a profit? - **Frequency**: Are sales regular and repeated? - **Modification**: Did you improve the item before selling? - **Volume**: Large numbers of sales suggest trading - **Time**: Do you spend significant time on buying/selling? **The £1,000 trading allowance** If your activity is classified as trading, the first £1,000 of gross income per year is tax-free under the trading allowance. Above this: - Register for Self Assessment - Declare income and deduct allowable expenses (or the £1,000 allowance) - Pay income tax and Class 4 NI on profits **Example: James** James sells old clothes and toys from his loft — earns £600. Not trading, not taxable. James also buys job lots of electronics at car boot sales, refurbishes them, and sells on eBay — earns £8,000. This is trading. Tax on £8,000 − £1,000 (allowance) = £7,000 profit. At 20% basic rate: £1,400 tax. **HMRC platform data-sharing** From January 2024, under DAC7 (EU-derived rules adopted by the UK), eBay and other digital platforms must report UK seller data to HMRC: total sales, number of transactions, and seller identity. HMRC can cross-reference this with tax records. Do not assume undeclared eBay income is invisible. **CGT on personal items** Selling a single personal item for more than £6,000 can trigger CGT (the chattels exemption applies below this). This is rare for most eBay sellers but relevant for valuable antiques, jewellery, or art.
More answers
This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.