Are your taxes in order? eBay now sending sales data to HMRC

[myriad*seller]

From 1st January 2024 eBay will be legally required to give all sales data to HMRC, so business sellers not paying taxes and/or masquerading as private sellers on eBay will soon be a thing of the past

Plus it will be interesting for all the sellers that now have to declare previous years turnover and pay back taxes and penalties...

This isn't the usual "HMRC are clamping down on sellers" line they use to scare people (but never actually do anything), this is a whole new digital computer system and reporting system that eBay are legally obliged to do from now on, to send all sales details for all sellers to HMRC so they can ensure people are paying taxes on their "side hustles".

It will also apply to other self employed roles such as delivery drivers and people who rent out via AirBNB and similar platforms, all their income will be declared to HMRC who will want those figures to match the taxpayers tax return. 

There will be a lot of worried eBay sellers now.... who've been trading illegally for years, with the feedback history to match, and who have pretended to be "private sellers" until now... 

https://www.thisismoney.co.uk/money/bills/article-12640869/Is-taxman-coming-hustle-Airbnb-Ebay-Uber-...

[theelench]

As a private seller who doesn't use any of the features you propose that all private sellers should be banned from using.  With the exception of a couple of FVF Offer listings once in a while and being able to list for free a few more items, in between, I have precious little incentive to list anything on ebay these days.

I know my listings will be buried under sponsored listings on the results pages and even if found by some lucky buyer will be chopped to pieces by rows of more sponsored listings.  I also know that all too often I will be undercut on postage by business sellers who sell enough to get reduced rates from carriers.

A great many private sellers find themselves in the same boat, with sales becoming ever less frequent as the search is continuously reconfigured with higher volume, business sellers in mind.

If ebay were to act on all your proposals would there be any incentive for private sellers to list on ebay at all?

Having 'levelled the field' by stripping away all the above, how would you 'sell' ebay to genuine private sellers?

Perhaps with a slogan along the lines of:

"Clear your attic by listing stuff on ebay.  If you list it long enough, cheap enough and are happy to accept an offer of even less, you might eventually sell something!!" 

[1984jo]

This is what I read somewhere that eBay over the past decade have given all  information about sellers to HMRC and nothing has changed just the way the information is been given, and it the law now, where before it was more voluntary but eBay always sent the information to HMRC. Not sure if this true, just something I read. 

[ett1954]

Ebay (and other platforms) previously only supplied information to HMRC upon request.  eBay I am sure would be required to have advised you if they had provided such information and they will be doing now once they submit any information to HMRC.

HMRC can still request information for previous time periods should they come across anything that concerns them on the information that will now be provided to them.

[twfan11]

It can be very useful though.  For example if you are selling off a collection on one account and random stuff on another.  And is not against any rules. 

Ebay will know that both accounts belong to the same person so it should not be a problem for them when they are informing HMRC. 

[twfan11]

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@the_book_seekers wrote:

This may have already been answered in this thread but, why do ebay allow 1000 free listings per month (i think thats right?) if you are supposed to have a business account for trading/business activites?  Surely listing above say 30 items per month would be classed as business activites/trading.

It's not just that there can be an up to allowance of 1000 listings a month, it's also that if you're lucky enough to get the 1000 limit and then use that limit - the next month there will be another 1000, and the same the month after that, and so on. This is not private seller listing. Even if the allowance is half the maximum a month it would still be possible to build up to 3000 listings in 6 months. A private seller of stamps or postcards or the like may need a higher number of listings, but for a private seller to justifiably need over a thousand listings has to be a rarity. ebay has been far too hands off in this area.

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That's not how the 1000 free listings works, is it?.  For example if you list 1000 items one month and sell 2 of them, the next month you relist 998 that didn't sell and 2 extra.  You don't end up with 2000 listings.  

Not that I think that private sellers should need 1000 listings at all. 

[twfan11]

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@ett1954 wrote:

Opening mutliple accounts will be a red flag to HMRC as each will be traced back to the seller's National Insurance number, which every seller has to shortly provide, this is unique to an individual.   A business seller would be linked via their UTR number.  Several selling accounts by a private seller would immediately raise suspicion and I am sure HMRC will have that workaround covered.  A private seller has no need to open multiple selling accounts ...... if they are indeed a genuine private seller.

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Having multiple selling accounts should not be a red flag.  It is not against any ebay rules and ebay knows exactly which accounts belong to one individual.  There is no attempt at evading any reporting to HMRC by doing that.   

[ett1954]

If you read my post (# 480) I was responding to a poster who suggested that it could have been a loophole and that people who were acting illegally would open multiple accounts and just sell 29 items per account (post 478).

eBay have always known who has multiple accounts - now HMRC will.  You are correct you can legitimately have more than one account and no where have I suggested that anyone who has more than one is acting illegally.  You said " There is no attempt at evading any reporting to HMRC by doing that. " .......... but there could be.

HMRC have specific criteria which they check when their suspicions are aroused and this could be one that could draw attention to a seller, innocent or otherwise - one of these criteria is: 'Limited time between purchase and selling, bringing into question the ownership of the seller' . 

All your purchases are also on these accounts and many people use different accounts for purchasing (nothing wrong with that) ; HMRC are also allowed to request your purchase information when carrying out investigations.  Again genuine private sellers will have nothing to fear - irrespective of how many accounts they have.

[the_book_seekers]

That's not how the 1000 free listings works, is it?.  For example if you list 1000 items one month and sell 2 of them, the next month you relist 998 that didn't sell and 2 extra.  You don't end up with 2000 listings.  

There are some private sellers with thousands of listing. It's been discussed in other posts - what ever a private seller has as a monthly limit renews each month. So if the limit is 500 and they sell 100 leaving 400, the following month there will be the ability to list another 500 in addition to the remaining 400 making a potential for 900 listings, and so it builds up. I haven't seen anything to say this has changed, but I'm happy to be corrected.

[kempseykate]

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@twfan11 wrote:

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For example if you list 1000 items one month and sell 2 of them, the next month you relist 998 that didn't sell and 2 extra.  You don't end up with 2000 listings.  

Not that I think that private sellers should need 1000 listings at all. 

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If I list 1000 items this month and sell 2, next month the 998 roll over free of charge, and I can list another 1000, so 1998 listings on the 2nd month.

(As my listing allowance is less than half a 1000, I, and many other private sellers couldn't do that, even if we wanted to.)

[39hall]

As an accountant I hope I can put peoples worries to rest. The vast majority of people just selling things on Ebay need not worry. You can sell up to £1,000 of stuff (turnover) without having to register with HMRC as an actual trader. Basically HMRC are not interested if you have very little going on. 

In the event HMRC did decide to look at you as a 'trader' you would then have the opportunity to submit your expenses against the 'turnover ' you have on Ebay. So against the income you make on Ebay you can claim all Ebay fees, Paypal fees, postage and packaging costs and either the original cost of the item you are selling (if it is fairly new) or its second hand value to establish your actual bottom line profit. It would potentially be this that you pay any tax on.  As most people would be just selling their own property usually at less than you paid for it you would effectively make a loss once all expenses were claimed so no profit - no tax to pay. 

HMRC are only after people who are genuinely tring to make profit on selling things - one of what they call the badges of trade. If you sell with the intent of making profit you are trading and as such should be taxed. Just wanted to very simply clarify the situation for genuine people just selling off stuff no longer wanted around the house.

[harry_armfield]

To 39hall accountant

Hi. Where would old vinyl records come under your definition? I am selling my record collection of 30 years as it has grown too largeswr, and inevitably I will have made some profit on each item as records are very popular these day. I am not a trader in as much I buy one item one week and sell it the next for a profit, I am just unloading a collection which is quite valuable.

Best H

[1984jo]

Well I not sure how they are going to do it to also how are they going to no if it your own personal items u are selling to ones u may buy to sell. Someone said they will see the size of the items but no, if anything like me over the past 15yrs my weight went has low as a size 8 and up to a size 16 so that not really going to say anything about it been a personal items to buying to sell. Also are they really going to be interested in someone who maybe sells 30 items a month but only making £100-150 on them, I just do not see it myself, as this would be a complete waste of tax payers money. I would think the people they are interested in are people who are selling like 250+ items a month making thousands and not declaring it because that will be worth while. Also little of subject, I was reading some people who are getting a little worried even enough they are selling there own stuff, are saying they are just going to thrown things in the bin instead so not sure that is good to. 

[the_book_seekers]

In the event HMRC did decide to look at you as a 'trader' you would then have the opportunity to submit your expenses against the 'turnover ' you have on Ebay. So against the income you make on Ebay you can claim all Ebay fees, Paypal fees, postage and packaging costs and either the original cost of the item you are selling (if it is fairly new) or its second hand value to establish your actual bottom line profit. It would potentially be this that you pay any tax on.  As most people would be just selling their own property usually at less than you paid for it you would effectively make a loss once all expenses were claimed so no profit - no tax to pay. 

So in essence HMRC will invite these sellers to complete a self assessment.

[555njp]

That's certainly what they used to do when people were reported. They'd basically give them a chance to come clean first, declare their income and pay tax due.

Obviously now everything is digital it'll be much easier for HMRC to present evidence although they'll likely only do that if an individual contests the demand. (bit like getting caught on camera speeding, you only see the picture if you contest the conviction!).

[39hall]

Hi, I only posted a general item to help. Not going to get into providing individual advice but if you check HMRC website there is a lot of information there that should answer any questions you have. Regards 

[geosacha007]

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@retro-boy-81 wrote:

This may have already been answered in this thread but, why do ebay allow 1000 free listings per month (i think thats right?) if you are supposed to have a business account for trading/business activites?  Surely listing above say 30 items per month would be classed as business activites/trading.

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Not necessarily.  Since barely anything sells these days it is easy to accumulate 100 listings over time, even if you only list a few extra items each month.

[theelench]

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@geosacha007 wrote:

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@retro-boy-81 wrote:

This may have already been answered in this thread but, why do ebay allow 1000 free listings per month (i think thats right?) if you are supposed to have a business account for trading/business activites?  Surely listing above say 30 items per month would be classed as business activites/trading.

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Not necessarily.  Since barely anything sells these days it is easy to accumulate 100 listings over time, even if you only list a few extra items each month.

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What ebay actually offers is up to 1000 free listings a month.  After a decade of selling, my free listings are 200 a month.  Why 200?  I really don't know, I've never had more than 30 items listed at any one time and never asked to increase my listing limit.

Why does ebay say "List up to 1000 items for free"  --  Because it's a nice, round, eye-catching number to use to promote the site.

As @geosacha007  says, even listing a few items each month, if they don't sell they soon mount up.

Last year, as my sales fell ever lower, for the first time ever on ebay I started the re-list as Sell Similar malarkey.  I generally list one item a week as an auction.  If it doesn't sell I re-list as BIN, making 2 items per week  --  roughly 8 items per month rolling into the total for a bulk Sell Similar re-list at the start of each month.  I started that in May(?), by the end of 2023 I was Selling Similar almost 30 items.

Perhaps you know this already, so forgive me if I'm stating the obvious.  You can find your Listing Limit on your Seller Hub, I think, under the "All Selling" heading.  More than likely you don't have 1000 free listings either!🙂

[*devils.advocate*]

Apologies to those who know.

Personal monthly limits and the monthly (up to) 1000 listings work in tandem - but differently.

If someone were to list 200 auction items, their personal limit would be used up and the 1000 limit would reduce to 800.

If they didn’t sell anything, once the auctions finished, the personal limit would revert back to 200 (because there are no active listings) but their monthly allocation would remain at 800 only.

Relist the 200, and the figures reduce to zero for their personal limit and then 600 monthly limit - etc.

So, if anyone listed  (say) 250 items every 7 days (within their personal limit and assuming nothing sells), their monthly limit would show 1000 Used and 0 Left.

Yes, I know, a very, very basic example but someone only needs 250 items to reach that 1000 mark.

Using the figure of "1000" and the word "free" is only a ploy on eBay's part - it sounds good.

Genuine private sellers should have nothing to fear from all the misinformed hype - it's the "private" sellers who should be by the informed comments.

And yes, the only thing eBay has done to those “private” sellers who abuse the system, is turn a blind eye.

[8248elaine]

I cannot see the charity donations I made on my report showing my total sales

[*vyolla*]

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@8248elaine wrote:

I cannot see the charity donations I made on my report showing my total sales

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You're asking this on the wrong thread, but you can view your donations by selecting 'Invoiced Donations' from the left hand side of the page here:

https://www.donation.ebay.co.uk/dashboard/settings