Since 1 January, HM Revenue and Customs (HMRC) has required digital platforms such as Airbnb, eBay and Vinted to collect and share data on how much money their users earn. The move, dubbed a 'side-hustle tax' crackdown, aims to identify undeclared income from online selling. However, many users fear the rules are overly broad and could penalise those simply decluttering their homes.
Edward, a 69-year-old retired tax inspector from Dudley, has sold about £2,500 worth of personal belongings on eBay over the past 10 months. He argues that he is not trading but decluttering, and believes he should not owe tax on items sold for less than their original purchase price. 'Even if I were deemed to be trading, the amount liable to tax is not the amount received, but the profit,' he said. HMRC's £1,000 threshold for trading income may not apply if the activity is not considered a trade.
Connor, a software developer from Nottingham, sells model kits both professionally and personally. He worries the new system will not distinguish between personal and professional sales. 'How is the system going to recognise, automatically, the difference between someone who is actively trading and someone just selling personal stuff?' he asked. He plans to shift to private sales to avoid potential headaches.
HMRC has stated that occasional sellers making fewer than 30 transactions and earning less than €2,000 (about £1,700) per year will not be included in the data handover. A spokesperson added that exceeding these thresholds does not automatically classify someone as a professional trader. Despite these assurances, many remain sceptical about the technicalities of the new system.
