Confused over needing NI number and allowances

[jrd-games]

My non-related business *completely* died in May last year but I still had a huge tax bill from the previous tax year to pay off, so resorted to selling off a lot of my prized possessions on eBay to soften the blow.

Today, I just got a notification about supplying my National Insurance Number to eBay. 

Have seen conflicting info. One thing was saying I should be paying taxes as the sales did cross the £1700 threshold, but a page on the HMRC site says I don't need to as I was selling my personal possessions below 6k. What to do here?

To be honest, the platform is now absolutely *awful* to use as a private seller so was just thinking of closing my account anyway.

[wintersdawn1]

• If you are selling unwanted personal possessions such as old toys or clothes, this would not be classed as trading or miscellaneous income, and there is usually no tax to pay. In some circumstances there may be capital gains tax when selling valuable items such as jewellery, this is covered in our flowchart.

https://www.litrg.org.uk/news/selling-online-make-sure-you-keep-clear-records

Do I have to share information with HMRC?

From January 2024, new UK digital sales reporting rules require digital platforms like eBay to share information with them. However, this reporting doesn’t change your tax obligations.

On eBay, this should only affect newly registered accounts in 2024, which will extend to all accounts in 2025.

eBay will only report if you pass certain yearly sales thresholds:

• If your total sales on eBay exceed €2000, or roughly £1740, after fees.

• If you complete 30 or more sales transactions on eBay.

In general, selling personal items is not taxed if they’re below £6,000 and you’re not selling as part of a business.

https://www.ebay.co.uk/sellercentre/selling/selling-online-and-hmrc

[papso22]

Where did you see information that you have to pay tax on sales over £1,700?  That's completely wrong information!

[*vyolla*]

A private seller selling their own personal items such as bits and pieces from their wardrobe/loft/garage isn't subject to tax, you can check your status with HMRC's checker here:

https://www.gov.uk/check-additional-income-tax

The £1770 figure is a reporting figure that the online sites use: eBay and the other online platforms (such as Vinted, Depop, Etsy) will pass on data to HMRC automatically if you're selling 30 or more items a year OR have total earnings over the equivalent of £1,770. eBay will automatically share this information with HMRC by 31 January 2025 .

Even though the above data is being shared, it doesn't mean that you will owe tax if you're a private seller.

The £6,000 figure you're quoting refers to capital Gains Tax - the tax that is due to HMRC if you sell an item (or a collection of items in one sale) for over £6,000.

There is a £1,000 Trading Allowance for small/hobby business sellers. They can sell £1000 worth of goods (gross sales, not profit) before having to declare this on a self assessment return. This is useful for those starting up or those not selling many items that they've bought or made to re-sell.

[jckl1957]

In the past few days, Ebay have begun to ask private sellers for their NI numbers.

As was very widely publicised last year, Ebay has to pass information to HMRC regarding all sellers whose sales in a year exceed 30 items or about £1700.

What HMRC then do with that information will be up to HMRC.

This link shows you what Ebay have to report - they do need to give HMRC your NI Number.

https://www.ebay.co.uk/help/account/regulatory/sales-reporting/uk-digital-sales-reporting?id=5454

Ebay and other platforms were expected to begin wholesale reporting in January 2025 but then HMRC altered the timescale (source HMRC website)

Extended time limits for due diligence on pre-existing sellers

When you first become a reporting platform operator, you have until the end of the second year to complete due diligence for pre-existing sellers, who are those who have been registered on your platform before you had to start reporting.

This gives you an extra year to collect and verify information for pre-existing sellers. 

If you do this, you’ll need to add a reporting notification in the online reporting service to tell HMRC.

For example, if a platform operator becomes subject to the reporting rules on 1 July 2024, its first reportable period is 2024.

The date by which it must complete due diligence is:

• 31 December 2024 for sellers who registered on or after 1 July 2024
• 31 December 2025 for sellers who registered before 1 July 2024
•  

  If you want to see what information regarding your sales Ebay have passed to HMRC, use this link which will confirm (or not) if your sales information has been passed to HMRC.

  Digital sales report

  You receive a Digital sales report if your number of transactions or total transaction amount meet the reporting threshold in a calendar year. Find out more information on our Help page.

    https://www.ebay.co.uk/mes/transaction-reports?q=tax

[deba3602013]

What about Buyers' accounts?  

If over a certain £ amount purchased or multiple buys of the same item, such as a mobile phone?

Does HMRC have access to eBay acounts to all those in receipt of any kind of benefits?

[jckl1957]

Only if they also sell on Ebay and exceed the thresholds.

HMRC are not really interested in what you buy - they can only collect tax on what you sell.

If you believe somebody on benefits is claiming/acting fraudulently (and, tbh, buying mobile phones is not a fraudulent activity) you can report them to the DWP.

[deba3602013]

I'm not quite sure you get my drift, but thank you anyway for your reply.

[1956glyn]

IF HMRC believe anyone is involved in any illegal activity then they can get access to any accounts they know of held by that person.       At a guess and its only a guess.......IF Ebay suspects a member of say "money laundering" then they prob would report them to the appropriate authorities.   

My son is currently buying a house........to do that its like trying to get into Fort Knox.    All relating to money laundering rules 😞    To be honest it seems worse when one only wants a very low mortgage.

[*vyolla*]

---

@deba3602013 wrote:

What about Buyers' accounts?  

If over a certain £ amount purchased or multiple buys of the same item, such as a mobile phone?

Does HMRC have access to eBay acounts to all those in receipt of any kind of benefits?

---

Purchases aren't reported.

DWP has access to bank accounts though, so anyone in receipt of a benefit who is selling on eBay and is worried should check this with DWP.

[deba3602013]

Hi. 

Yes, re money laundering, I was curious to know if they actually pursue this sort of thing.  Maybe they have no legal obligation to do unless contacted by a particular agency regarding a particular person.

Re Fort Knox - is there really gold in there?  If there is so much corruption by those running the show, maybe it's only fool's gold left.   Why make a point of telling everyone where it is and then have to spend a fortune protecting it? 

Good luck to your son.  Home Sweet Home.

[deba3602013]

Mobile phone purchases came to mind when thinking about organized crime.  If someone's purchasing phones all the time ...

I think I read that DWP has access to any and all social media accounts and email etc. of anyone who is in receipt of benefits.  Guilty until proven otherwise.

My advice to everyone everywhere is just clean up your act.  Stop cheating and lying and stealing.  Just because everyone else is doing it ...

I've had people say that to me.  "Everybody else is doing it, that's how you get ahead in life."  So sad.  You won't amount to much (financially) if you don't play the way they do.

[ett1954]

"Re Fort Knox - is there really gold in there?" - There is, however once the boss has had a look it will be probably moved to 'Fort' Mar-a-Lago for safe keeping.

[vintique*violet]

I agree there is a lot of information to absorb and some is not factual and/or confusing. @jrd-games 

The selling of personal possessions does not make you a trader or a business and so not usually subjected to be taxed, unless an item sells for more than £6000 and CGT could apply, but not always as it depends on the category and more. 

The £1000 TRADING allowance is for traders ( hence the name) and there is no new tax for online selling!

What has changed is the way that online platforms that people use to sell goods and services report information to HM Revenue and Customs (HMRC).

The £1700 / 30 item threshold is for eBay to comply with the new Gov. online selling of goods and services rules , hence the new reporting of seller accounts.

Digital platforms must share sales data and some personal information for 2024 with HMRC by the end of January 2025. If you have sold at least 30 items or earned roughly £1,700 (equivalent to €2,000) using platforms like eBay or Vinted, or provided a paid-for service such as a holiday rental through Airbnb on a website or app in 2024, your platform provider will let you know that your information has been shared with HMRC.

The new reporting requirements for digital platforms came into effect at the start of 2024. It is not a new tax. Whether you are selling last year’s festive jumper, clearing out a child’s outgrown baby clothes or quietly offloading an unwanted Christmas present or two – nothing has changed for online sellers.

The sharing of sales data does not automatically mean you need to complete a tax return, however you may need to register for Self Assessment and pay tax, if you:

• buy goods for resale or make goods with the intention of selling them for a profit
• offer a service through a digital platform – such as being a delivery driver or letting out a holiday home through a website
• AND generate a total income from trading or providing services online of more than £1,000 before deducting expenses in any tax year

If you are unsure whether your additional income could be taxable, you can read our guidance and use our free checking tool.

Plus eBay are now using this as a "marker" to make "suggestions" to accounts who reach or are over this, that they need to register for a business account - without any prior evidence that they are actively running a legitimate business. This "policy"  poses an issue on many levels,  resulting in  account " restrictions" or " held funds" until that account holder supplies eBay with whatever they ask for, and/or " upgrades?"  How do you prove a negative?

This is an overreach by eBay to " push" genuine private sellers into opening a business account when there is absolutely no legal requirement to do so.   Seemingly it is affecting more so those who are selling off their personal "collections" which can be 100's if not 1000's collected over the years...and by doing so does not make them a business!   It may hopefully "catch" those who are businesses but actively selling under a private account - breaking eBay  policy and consumer law etc and this would be a positive, but not holding my breath as it has been going on for decades. 

[jrd-games]

I am the exact kind of seller who you're referencing at the end there: I've had to sell off my collection of games that I have been collecting for 5 years, all to pay a massive tax bill. Having to pay tax on top of that tax would just feel like pushing a boulder uphill. 

[vintique*violet]

Understand, and there are 1000's possibly hundreds of thousands doing the same - and so you are not a business /trader - You are selling from your personal " collectables/collections" whether part or in full, and is your prerogative to do so...These can be classed as assets as can go up or down in value over the years...  and it is only the £6000 GCT which you should take into consideration... this is if either one item sells or a set to the same buyer and reaches that amount (6k) .. ( lucky you if if it does 😉 ) and there is still a £3000 tax allowance ... have a research on CGT if you haven't already done so. 

[vintique*violet]

Additionally if you wish to continue to sell unfortunately HMRC now require your national insurance number of which eBay are collecting. 

You can sell personal possessions  whether collectables or not, and this does not make you a trader or business, if  there are any insinuations by eBay trying to get you to be a "business" by upgrading to their business account, challenge this as it would mean you are then " trading" online, subject to business regulations/ consumer  law etc , but  not registered with HMRC as a business...which then can open another huge can of worms. @jrd-games 

[alfifletch27]

yeah this is not good 

let’s say 

you bought £5000 worth of items to resell on eBay 

in one year selling your selling 

total 🟰 £15.000 

bases on 12 months 

= £300 per week 

ebay costs 

Envelopes wrapping postage 

and lose of sales through the year 

ie refunds 

so this is based on a rough estimate! Out of the £15.000 takings cont

£15.000 takings 

£5.000 layout 

£200 envelopes ) could be higher 

£100 tapes & wrapping ) could be higher 

£15.000 takings 

-£5.000 layout 

-£200 layout

-£100 layout 

-£200 refund loss (could be higher)

£15.000

- £7.500 layouts costs

= £7.500 

this is just all roughly calculated 

for all the hustle of selling 

on £7.500 profit 

so now your get taxed on£140 a week side line in the end your slaving for after being taxed and all the hustle £90/ £100 per week extra maybe even less after being taxed etc other charging costs yes going over a threshold in takings looks good but after all the costs and now getting taxed on very small profits) I think it’s not worth the while on the small seller shame I like ebay but now it’s getting to controlling a hobby for a little extra cash is now a work industry iam off this soon if iam going to continue selling what I sell I start a refresh myself maybe own platform 

[jckl1957]

Just a query.

You have referred to a £3000 tax allowance.

Can you explain what that is please?

[ett1954]

The actions you describe above is that of a business seller who should, by law, be submitting a self assessment to HMRC; in addition to being registered on eBay correctly to comply with the legal requirements under UK consumer law.

The tax on profits would be dependent on their own personal circumstances declared on the self assessment.  If they had no other income from paid work, benefits, savings and investments it is unlikely they would be paying any tax.

"iam off this soon if iam going to continue selling what I sell I start a refresh myself maybe own platform" - this would not change any of the requirements above.  I would suggest you try and get a 'free' session with an account who could advise you on how to mitigate your costs.