Selling on eBay has become increasingly common, whether you're clearing out unwanted items, selling collectables, or running a small business. As your eBay sales increase, you might wonder: do I need to pay tax on what I sell?
Here's what you need to know about tax and eBay sales, including the difference between occasional selling and trading, when tax may apply, and how HMRC and eBay now share data.
Usually No Tax Due
If you are only selling items from time to time, such as second-hand clothes, furniture, or gadgets, HMRC usually won't consider you to be trading, and no tax would be due.
Clearing out unwanted items occasionally
Tax May Be Due
However, if you are buying things with the intention of selling them, regularly reselling for a profit, or running a small online shop, HMRC may treat you as a business.
This can apply even if it's not your main source of income
Buying to Resell
You buy goods specifically to resell at a profit
Making to Sell
You make items to sell, such as crafts or personalised gifts
Regular Selling
You sell regularly and in a business-like way
Marketing Activity
You advertise your products or take custom orders
If you are selling personal items for less than you originally paid for them, such as books, clothes, or tech, you will not usually have to pay tax.
You bought a mobile phone for £800 last year and now sell it for £400 on eBay.
Since there is no profit, no tax is due.
However: Even if the items are personal, selling regularly or in high volumes might still attract attention from HMRC.
You may have heard the term "eBay tax" used online. Whilst it is not a formal HMRC term, it is often used to describe the tax that might be due on income from selling on eBay.
There is no separate eBay tax
But if you are trading, your income could be subject to income tax and possibly National Insurance, depending on your earnings and circumstances.
It's not the platform you use, but the nature of your selling activity. Whether you sell through eBay, Vinted, Etsy or Facebook Marketplace, the same tax rules apply.
Not sure if you need to pay tax on your eBay income? Use HMRC's official tool:
Check if You Need to Pay TaxOfficial HMRC guidance on additional income
HMRC has increased efforts to identify undeclared income from online selling.
Thanks to international data-sharing agreements, eBay and similar platforms are now required to pass seller information to tax authorities.
Seller names and contact details
Transaction numbers and values
Linked bank accounts
This means HMRC may already be aware of your activity, so it's important to remain compliant and declare all taxable income.
If your total trading income (from eBay and other platforms) exceeds £1,000 in a tax year, you usually need to:
Sign up with HMRC as self-employed
File by 31 January each year
Even if you think you won't owe any tax, it's best to check. Registering voluntarily also shows you're acting in good faith with HMRC.
At Taxwise Accountancy, we specialise in helping sole traders, side hustlers and small businesses remain tax compliant.
Get registered with HMRC correctly from the start
Structure your side business properly for tax efficiency
Calculate your profits from eBay accurately
Understand what expenses you can claim
File your tax return correctly and on time
Expert advice whenever you need it
We're here to make things simple for you.
Whether you're just starting out or need help catching up, our expert accountants are here to help you stay compliant with HMRC.