Post-Christmas Clear-Out May Alert the Taxman!

Thinking of clearing out your unwanted Christmas gifts or making way for the new!!

Well, if it’s a one-off or once a year, you’ll be ok if HMRC come knocking on your door.

However, if it’s habitual they will be taking a second look, under new rules, launched right now, to see if you are trading!

HMRC is calling it a ‘side hustle’ and believe that millions of us have secondary sources of income topping up our earnings through platforms such as Vinted, Etsy and eBay etc.

eBay has been scrutinised by HMRC with people targeted for trading on there, for many years. Many people trade on there as their main job turning over sometimes in excess of the VAT threshold and they, I’m sure, are not surprised when they get the brown envelope on the mat ! You only have to look at the people in front of you in the queue at the post office to see those posting 40 or 50 parcels a day, to see how prevalent it is.

However other people dabbling on eBay could be caught for tax if they have for example other jobs taxed under PAYE. If so, they are likely to have exhausted their tax-free personal allowances and any profits earned from eBay trading on top of this, are fully taxable and subject to Class 2 and 4 National Insurance.

If you think you are likely to be subject to an investigation by HMRC call Lindsay on 07879 464 577 for a quick chat or drop her a message through the website.