Ebay forces upgrade to Business due to new HMRC regulations

[sportex-uk]

Hi All.

I've received an email from ebay forcing me to switch to business account due to the volume of my recent sales. Customer service explained that I exceeded £1800 in one month, so they act in line with new HMRC regulations. The email is a bit threatening: "We need you to make these changes to your account within the next 21 days. If you don’t, your selling privileges may be blocked. This includes listings ended and loss of selling history."

However, As I'm not ready to go business and I consider my increased activity as temporary, Customer Service advised that if reduce my sales volume, I can stay private. Has any of you passed through this process?

Also, what happensto your existing promo listings if you switch to business? Are they allowed to continue on promo terms and with 'no returns accepted' until they sell or end?

[litp*records]

180 replies for the OP to just stick their fingers up to all the advice given, smh

[thebeautician]

Great thread!

It took me a full lunch to read it. 🤣

[potters_uk]

For anyone who might think that HMRC dont have the personel to deal with large numbers of Ebay accounts, you might want to look up the word " out sourcing "

[sportex-uk]

I agree with you totally. IIt's ebay who creates pathologic situation, as how different can you call FVF Promos on such huge volumes, with monthly sales limit of £15,000 for new users? It's encouraging people to sell this way, so people just do this. Another thing is promo listings are far worse positioned and receive far less views than non-promo. Business sellers can also do premium service, what maximises visibility and I'm going to benefit from this, despite higher fees.

Another thing is lot's of crying business sellers here think that selling on a private means avoiding HMRC as well and they're serious in this nonsense belief.

Thanks for reminding - my backup account is on a different bank account, but I stopped all sales just in case, so I can take some time off and finalise my HMRC return in the meantime, then submit it straight away in April. Unless ebay will check it retrospectively and that will be the end.

[pillarboxred]

Business activity goes up and down and is thus always temporary.

I didn't know "no returns accepted" is approved by eBay and in some cases returns and refunds can be forced if eBay determines the seller is at fault. It happened to me recently.  If they kick you off, the business you would have had will go to sellers who are compliant: they will make your money for themselves. Maybe look at this change as an opportunity: the Dragon's Den hate businesses that aren't properly run. If you are a well-run business you become "investable".

[vintagecraftsandcollectables]

Had the same 'upgrade to a business account email' as others.  Spoken to 4 customer serive assistants, who clearly have not been given the right information in regards to eBay's policy and the criteria to differentiate a personal seller from a business seller irrespective of HMRC reporting requirements.

Just been informed, and confirmed by his superviser that if you sell more than 30 items 'ever'...................yes 'ever' or £1,700 'ever' you will be forced to register as a business.  Can't be right so waiting to see what happens before closing the shop. 

No problem with the requirement to report to HMRC, but refuse to pay eBay for a business level account/shop and register as a business to sell personal items.

Like others I'm clearing out a lifetimes collecting from myself and my mother.  Far more than 30 items,  I would guess an awful lot of people clear out and sell more than '30' items in their lifetime!!  

HMRC require eBay to report sales amounts and quantities, but that there's no law stating eBay have to charge personal sellers to have a business shop.  Private sellers simply file a self assessment and pay tax on any income over the new thresholds. eBay are shooting themselves in the foot by being greedy trying to make private sellers pay a monthly shop fee I think is £77 plus VAT per month, and claiming that's the new tax law, when it's clearly not. 

HMRC are not asking everyone who clears their kids toys, collectibles and garage contents to register as a business, just pay tax on levels over the annual allowence.

[pg_kicks]

Putting aside if you (or anyone else) is a business or not as its a circle that we could go around for years so pointless, a few things which I'll counter. Private accounts shouldnt be able to have shops, that alone makes buyers think they are buying from a business with the same rights as buying from a legitimate business.

Also as much as eBay may shoot themselves in the foot short term with people closing accounts they will make more in funds when accounts arent trading illegally and get 80% off fees, the reward for upgrading is a joke but least thats only 4 months.

I'd take the info from CS with a huge grain of salt, they are great for giving out wrong info but lets say its 100 a year, those items wont disappear, theyll end up at carboots/charity shops and people who trade on eBay as businesses will buy and resell them if the market is there, you may get less for your items but the market will decide the price.

Long term it could be a great thing for eBay, people can trust the site more, the market for the items will still be here and the stronger businesses other great customer service and complying with the law should flourish, these are the accounts eBay should be giving incentives too as these are the backbone of the site now. I hope eBay take an educated look at the cross over levels as some who are being given the email are clearly just private accounts but it seems just off this forums a lot are not.

[btr.style]

Complain all you like, you are a business seller. 40 wh smiths folders just happen to be an old purchase you never had any use for? And what's that in the description? You actually have 50 and more arriving. 

You are a business seller and what you fail to even consider is BY LAW you have to accept returns if selling for profit/reselling/business selling. So yeah, there is a law that YOU can't trade legally on a private account on eBay. You have broken several laws including distant selling regulations. 

Even doing tax returns does not mean you are trading legally. HMRC only care about tax avoidance. It's trading standards who check if people are trading legally or not and I'm afraid you haven't been so you could well be on their radar. 

By all means it's not me you need to explain anything to. I only say what I see but if you aren't declaring, it will be HMRC that will be chasing you. So if I were you I'd be trying to dig up all receipts for the almost 1000 items youve sold over the last few years as I'm quite sure you will have some explaining to do. 

[cobwebcottage]

A small observation. It does look as though you are selling off unwanted vintage and craft items which may be yours and your families unwanted possessions but you have 108 'new' listings many of which are not new.

For example, your Antique wooden bobbins are in the new category. They may not have been used, but are not new. The same with anything you have described as Vintage.

I sometimes get Vintage items unused in the box but have to list them as used and in the description, you can go in to more detail.

If, and this is a big if, the bots are identifying sellers listing new items, they may look at your account as being a business.

It may not help you now that you have already received a message for Ebay. The whole thing is one big mess, making genuine private sellers change their accounts. I really don't know what the outcome will be!

[vintagecraftsandcollectables]

Hi,

Agree the term ‘shop’ is not reflective of the seller but eBay’s terminology.

Yes took the ‘30’ lifetime limit explanation with a ‘huge‘ pinch of salt. It seems eBay is moving away from its original roots as an online sales place for individuals and has for a long time moved towards an online ‘department store’ for businesses.

My guess is their move will see more competitors like Vinted come on line & focus on the private seller market (tax regulatory requirements in place) now that society as a whole has caught the re-use, re-purpose. Second hand bug.

I’m wondering whether technically eBay are using the ‘business’ shop categories as their IT marker to enable bulk reporting to hmrc with minimum IT reworking. Rather than having to do IT work to identify business from personal?

Getting too old for all for it all anyway.

Sent from my iPhone

[papso22]

Ebay don't have to differentiate between business and personal traders or accounts in their reports to HMRC.  They simply have to report all accounts that breach one of the thresholds.

What they do have to do is work out what tax identifier they require, but for a sole trader or a private individual, that will be the same thing, the NINO.  

[pg_kicks]

If I were in charge of eBay I'd want to move away from a 50 private sellers with 5 or so items not offering returns and not 100% focused on the site to having 1 business seller with 250 items, all listed with returns, and more than likely to be focused on the site with item specifics/pictures and a good description, not saying private accounts do do this but if it was my business over pocket money I know which I'd try better at. It makes the site safer and a better experience for the buyer, all in meaning it costs eBay less.

There needs to be space for both, just better policing of the site be that incorrectly registered, badly listed items and fraud.

I've said it many times, eBay needs an open in person forum with its customers (sellers) both private and businesses as those in charge clearly never use the site.

[2000appletree]

If the amount exceeds £1k, you must declare it to the tax office. It's better not to start with them, the penalties are charged in thousands of pounds. Change to a business account, buy a store (preferably the one between the basic  and the anchor) and continue to make money from the sale. Regards

[shopping-ferret]

I get what you are saying but even if it is temporary as you claim - you still need to upgrade to business and then once all your business stock has sold you can apply for a private seller account I think?  Maybe you can have a business and a private one, even?  I think that is the way you need to think about it and not the other way round.  Had this new law not come in, I feel you would have continued operating 'as a business' and obtained lots more one-offs.  

Equally, I am a registered business on Ebay and I am going to downsize soon as I will be retiring and downsizing to a smaller property without the storage I currently have for my stock.  I wish the law had not come in etither, as I would have liked to have registerd as a private seller and continued to sell off my remaining stock, as countless have enjoyed for many decades.  But I can't do that now.  It would have helped top up my state pension - many pensioners have enjoyed this privilege for years.

Business sellers resent  business sellers masquerading as private sellers - no matter how you justify,or interpret it.   But if you are declaring your earnings to HMRC as you say, then the only issue is you do need to upgrade to being a business, or else get rid of your 'one-off' and remain a genuine private seller.

[theelench]

Yes, that might make sound business sense, yet ebay has recently raised my selling limits from 200 a month to 10,000 and £100,000 value.  It continues to give me free listings and even reduces my FVF every fortnight.

This might be because I do offer returns on all my listings, do fill-in every item specific, provide good photos (not cleverly shot to miss damaged areas),  informative descriptions several paragraphs in length and in about ten years have had exactly 2 cases raised by buyers, where I handled the returns without involving ebay.

And I will say that my standards are higher than some of the business sellers I've had the misfortune to buy from, who have tried to deny me my rights by attempting to deduct their selling fees, return postage costs and even a re-stocking fee on occasion, from their refund and tried to string me along to time-out the request.

My reward for my 'lack of commitment to ebay', mainly demonstrated by my refusal to pay them at least  10% of the transaction value in promotional fees is not having a sale for so long, they will probably hold my next sale proceeds as ebay has made me an Infrequent Seller.

Someone on the other site I sell on searched ebay (yesterday) for the three auctions I started last Sunday evening.  All with very similar titles, listed in the same category, a collectable ceramics niche.  They found one of them, the cheapest, the one with damage.

I find ebays lack of commitment to selling any of my items the most off-putting feature of the site.  You are wrong to generalise about private sellers 'lack of commitment', there are businesses as bad and often worse.  Without taking into account how ebay stacks the odds in favour of bad business sellers who will pay ebay to ignore their faults.

But you'll get your wish and soon I and (IMO) many others will stop selling here, ridding the site of another tranche of nuisance private sellers.  I hope you enjoy the further fall in sales that it will bring.

[sportex-uk]

This is very true about standards - many 'private' sellers offer far better service than plenty of businesses. Quicker postage, no problems with accepting returns even when they say they don't do so. In clothes and trainers department they still occupy a niche selling outlet products. Certain buyers are not interested in sub-standard so they buy exclusively from businesses, while others look for more affordable products and don't car about damaged or non-existent packaging. Both groups don't overlap fully. My thinking is that ebay keeps 'private sellers' on FVF promo on purpose, otherwise ebay would become a shop for businesses with inflated prices (due to high fees) lacking competition and some customers would just leave for Vinted, etc.

[howmuchtobid]

sportex-uk,

How is your illegal business going selling thousands of £'s worth of new trainers via private Ebay accounts?

Didn't you try a business account and last about 5 minutes?

[sportex-uk]

Yes, I continued on a business account and it was going fairly well at very similar level of sales, as I easily digested extra fees (ca £6 per item) by increasing prices by £3-4 on average, while £0.15 per item balanced my 2% return rate. I would have traded until now, but someone from this forum reported my placeholder listings and I received 30-day ban. So I moved out of ebay to another platform and continue making money. Even taxes are not that horrible if you handle expenses properly and keep below Higher Rate.

[howmuchtobid]

It wasn't going well at all, your sales dropped through the floor as soon as you changed to a business account, you broke Ebay policy after Ebay policy at the beginning of 2024, many of us witnessed it. People only need to look back at the beginning of this discussion. 

[sportex-uk]

This reminds me a conversation with a little one I know: "I'm 5, so now I know everything".

In fact, I didn't have to promote listings any longer, since non-80%FVF listings receive far more views, so there was a saving. The cut it my before-tax profits was 10-15% with 5% price increases to what I estimated. So the only drop through the floor I observed was the level of your comments.