Vinted tax rules in the UK mean most people selling unwanted clothes and other personal belongings do not have to pay tax on their sales.
But those buying items to resell for profit, or making goods to sell, may need to register for self-assessment if their trading income exceeds £1,000 in a tax year.
One rule which is vital to know and act on right now is the 5 October deadline for registering for self-assessment. The deadline applies to people who need to register for the first time for the 2025/26 tax year.
HMRC has also introduced rules requiring digital platforms to report certain sellers’ information. But being reported to HMRC does not automatically mean you owe tax and the onus is on you, the seller or side-hustler, to register, report and pay your tax on time - you can be fined if not.
Changes made by governments of recent years, such as lowering various tax thresholds, have dragged many more people into the net of self-assessment requirement.
Here’s what you need to know if you resell on Vinted and other platforms, as well as if you have different side hustles or generate non-payroll income of over £1,000 in a tax year.
Vinted sellers and eBayers
This is a particular type of side hustle that could easily catch people out.
If you make more than £1,000 on these platforms such as Vinted, eBay, Depop or others like them, you may need to register.
If you only sell your old, used items HMRC does not view that as taxable in most cases, but if you are buying things to sell on for more money, or making items you sell, then registration is required once the £1,000 limit is topped.
Whether you make more than a grand in a year from selling your second-hand clothes will heavily depend on how expensive your tastes are - but the platforms you use are now providing user information to HMRC in a similar way to stockbrokers have for decades.
Side hustles and second jobs
Anyone with a second income of £1,000 upwards through working outside their main PAYE-based employment must also register.
It does not matter what the type of work is, or how long you spend doing it.
If you are making more than this figure on the side, HMRC wants to know - and that’s earning £1,000 of income, not £1,000 of profit after expenses.
You will pay no tax if total earnings stay under the overall £12,570 tax-free limit, but registration is still required.
Investors
The need to register kicks in at a very low level that might catch people out, particularly in light of recent changes.
The capital gains tax allowance was £12,300 as recently as the 2022 / 23 tax year. That meant only people cashing in significant sums of money outside of an ISA or a SIPP had to register.
This has been heavily slashed though, first to £6,000 in 2023/24, then just £3,000 in 2024/25, where it remains now.
Any capital gains above this sum made outside a tax wrapper automatically make registration a requirement.
If you conduct frequent buys and sells with significant sums of money, that can be deemed as trading rather than investing by HMRC. Any money you make would be subject to income tax rather than capital gains tax. Registration is required either way.
Bitcoin and crypto traders
Exactly the same £3,000 allowance applies to cryptocurrency as to stocks, funds and other investments.
It can be argued that the risk level involved in Bitcoin and other digital assets is so different to traditional investments that different rules should apply, but HMRC does not see it that way.
Crypto assets cannot be held in ISAs or SIPPs, so that will not shield any gains unless you have your crypto exposure through an ETF in one of those wrappers.
That is not technically holding crypto anyway, as an ETF is effectively a stock.
Foreign income earners
Just because you have earned some money in another country, it does not free it from HMRC’s grasp if you are a UK resident.
Any income from abroad that is separate from your main income and above the £1,000 side hustle allowance may mean you have to register.
This can be a very complex area of taxation, so if you earn significant income abroad while still being a UK resident for tax purposes it may be a wise move to hire an accountant.
How to register with HMRC for self-assessment
Completing an HMRC self-assessment is often complex and time consuming.
Thankfully, just registering is a relatively straightforward job that should only take a few minutes - that’s all you need to do by the 5 October deadline date.
Start by visiting the Gov.UK page to check if you need to register.
You will need basic information to identify yourself to hand, such as a national insurance number and details of the money you have made in the last tax year.
If the answer is ‘yes you need to register’ then proceed to actually doing so - before the cut-off date.
When investing, your capital is at risk and you may get back less than invested. Past performance doesn’t guarantee future results.
