Selling my own items I've had years and already made over £1500 now worried about HMRC?

[paulsmename]

With all the hype surrounding the announcement about ebay, vinted air BnB etc....

I took the plunge at the end of december and decided to sell alot of my old Hornby Models, some are in new condition and wanted to make a bit of extra money. To my surprise they seemed really popular so i sold a few more and then so on. already making over £1500 on sales Im starting to get a bit nervous about the whole HMRC issue.  

Now i dont have receipts for these as some were brought for me or i purchased online over the years along with various shops. I read all the time about having to do self assesments as self employed. This is were things get a bit murky i currently work full time for a employer. 

So my questions

how would this work being already working?

Gone over the £1000 allounce will i now be taxed for the £500 or so?

or should I just wait for ebay to decide to pass on information and sit and wait for HMRC to contact me?

because i have a feeling there are many others in the same boat who are not even aware or what this all means as a private seller?

Many thanks

Paul

[missdollydaydream]

My advice. Contact HMRC and be honest. Forget about  anything eBay tell you or anything you hear on the grapevine. Even if you have to pay tax on anything over your allowance, you have probably made a profit on what you paid for the items anyway.

[paulsmename]

I think the thing which is confusing me is the self assesment because its based around someone whos self employed (which im not because of having a full time job)

How does that work out?

Thanks

Paul

[missdollydaydream]

Been round the block a few times and sparred with HMRC. Reach out to them now rather than let them reach out to you and they will explain everything.

[myriad*seller]

It is possible to be employed and self-employed at the same time

However, HMRC are only interested in people who are trading (buying items to sell). 

Not people selling their own unwanted items. if you are only selling your own items, then you are not trading, so HMRC will not require you to pay tax on these sales.

[*vyolla*]

If you're now selling off your own personal collection and didn't buy the items with the intention of re-selling then you're a private seller and shouldn't need to pay any tax.

 See here, you can check for yourself on HMRC's website:

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

What HMRC will do with the reported information is anybody's guess. My personal one is that you may receive a 'nudge' letter asking you about the sales and to confirm that you're a private seller.

[millcottage]

As far as HMRC are concerned - 'nothing to see here, move on'.

Selling personal possessions isn't taxable income.

The folks HMRC are after is someone who is not delclaring themselves for taxation and say buying 10,000 T Shirts for £5 each and selling them for £10 making £50,000 profit and walking away tax free with the money.

Why should Johnny work in a factory earning £50k a year and paying income tax  & NI on it , while his twin brother Fred sells T shirts on eBay making £50k ans pays nothing in tax?

[the_book_seekers]

The £1000 is a trading allowance for businesses and doesn't apply to people selling off personal items.

You've exceeded HMRC's reporting limit and may be asked to explain your selling. If asked explain it as you've explained it here. You've sold 151 items in nearly 20 years on ebay - a very small history of selling .

[geosacha007]

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@missdollydaydream wrote:

My advice. Contact HMRC and be honest. Forget about  anything eBay tell you or anything you hear on the grapevine. Even if you have to pay tax on anything over your allowance, you have probably made a profit on what you paid for the items anyway.

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Absolutely do not do this.  The OP is a private seller selling of his own no longer wanted items.  They have no tax liability and do not need to contact HMRC.

[magpiecorner1]

No need to worry, there have been no changes to HMRC rules.  It's only reporting that has changed.

If you have an individual items, or a boxed set, or a matched pair in your collection that sells for over £6000 this year (I think it's £3000 next year), contact HMRC for advice.  Normally, at the price level, you would be due to pay Capital Gains Tax.  You have an allowance, and you can even include your wife's allowance.  I suggest speaking to them as I have absolutely no idea if your, trains come under 'mechanical'.  Selling a full size engine would be excempt from CGT. so it makes sense that a scale model would be also.  But you never know!  But remember, other than sets or matched pairs, the threshold applies for each item, not the lot.  So you could sell 1000 pieces for £1000 each and have no tax liability!

Under the CGT threshold  (you can get further details on the HMRC website), and I expect most of your items will be under the threshold, you will be able to sell at your hearts content.  

Just because you are selling your items doesn't automatically mean HMRC have the slightest interest.

Read 'badges of trade' on the HMRC website, very illuminating!

Though, to read gumf here there and everywhere, you would think HMRC are wanting anyone who is selling stuff to open businesses.  Oh, if only!   

Nothing has changed, CGT is there to tax personal possessions, it's a sensible tax and allows for people to sell personal possessions.  You can still sell the Rolex you picked up in the local car boot (I've actually watched it done) and flog it for £12,000 the following week, with no tax liability.

[magpiecorner1]

Selling personal items is absolutely subject to tax.

It is, however, subject to Capital Gains Tax.    Sell the diamond ring you inherited from your gran, or the oil painting from your mum, or the Pollack you find at the local car boot and you have to consider GTC.  Though the Shelby Cobra and the Rolex from Uncle Joe is excempt!

[millcottage]

I said selling personal items isn't cl*need as income aka no tax on profit.

Yes obviously items can be subject to capital gains tax if over the £6k or next year £3k limits. 
I have paid this myself in the past when the allowance was £10k.

Also on a 2nd home property sale where gain was £110k. But that's a whole different set of citeria and deductions 😀

[magpiecorner1]

Your in danger of confusing folk, you state that '

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@millcottage wrote:

I said selling personal items isn't cl*need as income aka no tax on profit.

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Personal items are subject to tax, with the rules of CGT.

Model trains have been known to sell for over £200k so we'll worth printing this out.  Because it isn't obvious to all.

[magpiecorner1]

I've just checked the HMRC Capital Gains Manual

'Mechanical models and toys are always regarded as wasting assets'

So there would be no capital gains tax to pay regardless of sums raised, and regardless of whether the collection is sold individually or as a whole! Worth googling and printing the page in the totally unlikely event that HMRC comes knocking!

Time to get other half's toys out of the loft, he has a mechanical cat and dog picture that we were thinking of sending to the Repair Shop!

[millcottage]

You are the only one who seems confused 🙄

Yes I'm aware that model trains can sell for 100's of K.
A shirt sold this week for £25,000 😀

Nothing has changed tax wise anyway.

[tranceenthusiast]

Well this government is absolutely useless and departments are broke and have no staff. You'll be fine 😜

[keeptheroof]

No.

First, you have to hit the personal tax threshold for income.
Second, you can profit another £1,000 without being taxed.
Third, the likelihood is your expenses of buying these items then the cost of storage, selling, packing & postage means you can show you made no profit.
Fourth, The taxman only investigated 25% of reported tax fraud in the last 25 years. So the only possibility anyone might have is an automated email or letter. Which you can probably ignore. But I suspect only people turning over £500 a week might fall into this category.

[moldosgifts]

Only sellers who make the threshold will even peek the interst of the taxman.

Selling your own collection does not mean you fall in those rules but ebay have to send the details over its the law. This does'nt mean you owe the taxman anything just means ebay have to add your details to the list.

As long as you don't buy anything to sell your fine. So NO new stuff.

Sorry for spelling my mum died last night so hard to concentrate.

Best of luck to you.

[pillarboxred]

Collectors of vintage toy trains usually know that "new condition" is an important driver of value and are not surprised: they are seen as an "alternative investment".  You should make an inventory of your collection and assign the purchase prices paid as you remember them. These can't be challenged unless they look odd or incredible. Did you insure them? Insurance information might be relevant. I find it is very hard to make money on eBay: my storage costs £10 a day and I find that difficult to make that let alone a profit but there are very successful businesses on eBay and they need to pay their fair share.

[pillarboxred]

That would be a wonderful item for the Repair Shop: do it!