Vinted, Etsy and eBay Seller Tax: When to Declare 2026/27

Headlines about HMRC "tracking your side hustle" have worried a lot of online sellers. The reality is more measured. Selling your old things is usually tax-free. Running a small business through a marketplace can be taxable. This guide explains where the line sits for 2026/27.

Selling your own stuff is not trading

If you clear out your wardrobe, sell old furniture or pass on a games console for less than you paid, you are not trading and there is no income tax to pay. These are personal possessions, and selling them at a loss does not create a tax charge.

The only personal-item tax that can apply is Capital Gains Tax, and only on individual items worth more than GBP 6,000 that have risen in value, such as antiques or jewellery. For everyday secondhand sales this almost never bites.

When selling becomes trading

You are trading, and the income is taxable, when you are doing it to make a profit on a repeated basis. HMRC looks at "badges of trade", including:

• Buying goods specifically to resell at a markup.
• Making or crafting items to sell (typical Etsy sellers).
• Selling frequently and systematically rather than as a one-off clear-out.
• Modifying items to increase their value before sale.

If that describes you, the trading rules apply, and that is where the GBP 1,000 trading allowance comes in.

The GBP 1,000 trading allowance

Everyone gets a trading allowance of GBP 1,000 of gross income per tax year. If your total trading income is GBP 1,000 or less, you do not pay tax on it and you do not need to register for Self Assessment.

Above GBP 1,000 you must register and report. You then choose the better of two options:

• Deduct the flat GBP 1,000 allowance from your gross income.
• Deduct your actual allowable expenses instead.

Worked example: an Etsy maker

Tom makes candles and sells them on Etsy. In 2026/27 his gross sales are GBP 4,200, and his costs for wax, wicks, jars and postage come to GBP 1,700.

• Using the trading allowance: GBP 4,200 minus GBP 1,000 = GBP 3,300 taxable profit.
• Using actual expenses: GBP 4,200 minus GBP 1,700 = GBP 2,500 taxable profit.

Actual expenses win here, so Tom reports GBP 2,500 of profit. If this sits within his Personal Allowance of GBP 12,570 with no other income, he pays no income tax, but he may still owe Class 4 National Insurance once profits exceed GBP 12,570 (charged at 6% up to GBP 50,270).

What the DAC7 data rules mean

Since the DAC7 reporting rules came in, platforms like eBay, Etsy, Vinted and Airbnb report seller information to HMRC for sellers who pass set thresholds, broadly around 30 sales or roughly EUR 2,000 of income in a year. That is why you may be asked for your National Insurance number or tax details.

Being reported is not the same as owing tax. HMRC simply receives the data and matches it against returns. If you are only selling personal items, you have nothing to declare even if your activity is reported.

A quick checklist

• Clearing out personal items: no tax, no registration.
• Buying or making to sell, under GBP 1,000 gross: covered by the trading allowance, no registration needed.
• Trading over GBP 1,000 gross: register for Self Assessment, report income, deduct the allowance or actual costs.
• Keep records of what you sold and what it cost, in case HMRC queries reported figures.

To work out whether a side hustle pushes you into a tax bill, try the calchub.uk side-hustle and self-employed tax calculators, and read the selling online and trading allowance guidance on gov.uk before you register.