eBay is running a free listing promotion to reassure casual sellers that they needn’t necessarily pay taxes to the UK’s tax agency. “We want to give you peace of mind that there’s no new ‘side hustle’ tax. Like before, HMRC guidance says if you are just selling some unwanted items that have been lying around your home, such as the contents of a loft or garage, it is unlikely that you will have to pay tax,” eBay explained in the by-invitation-only promotion.
HMRC is the tax agency in the UK, and eBay linked to an information page on the UK government website where HMRC explains, “If you regularly sell goods or services through an online marketplace, this activity could be treated as a ‘trade’ for UK tax purposes and you may have to pay tax on your profits.”
In January, HMRC announced a new rule requiring digital platforms like eBay “to routinely report seller profits made on the websites,” according to the BBC, that is similar to the IRS Form 1099-K requirement in the US.
In its free-listing announcement that kicked off on Friday, eBay told UK Private (non-business) sellers, “The only change is that HMRC is now asking online platforms, like eBay, to share information with them. This reporting doesn’t change your tax obligations, and only happens under these new rules when you pass one of their thresholds: Your sales are over £1,740 in a year (after fees); or You complete more than 30 sales in a year.”
Sellers who receive the eBay invitation to “List with zero selling fees until 15 April” should read the terms and conditions carefully for details and restrictions and consult with a professional regarding their potential tax liability.
