Stage 2 – Vinted Advice
Here’s stage 2 of our Vinted advice
- Why Make a Voluntary Disclosure?
- Avoid Penalties: If you disclose the income voluntarily, you can reduce the penalties typically imposed for late or incorrect reporting.
- Stay Compliant: It’s important to comply with tax regulations, especially as HMRC is increasing its scrutiny of online sales.
- Clarify Your Situation: If you’re unsure whether you should be paying tax on your online earnings, voluntary disclosure can help clarify things.
How to Make a Voluntary Disclosure to HMRC
You can disclose your Vinted/eBay income to HMRC by following these steps:
Step 1: Review Your Online Income
First, gather all the details of your sales, including:
- Total income earned from selling on Vinted, eBay, and any other similar platforms.
- Any expenses related to your sales (e.g., cost of goods sold, shipping, packaging).
- Keep detailed records, as you may need to provide this information to HMRC.
Step 2: Register for Self-Assessment (if applicable)
If you haven’t done so already, you will need to register as self-employed with HMRC. You must do this by 5 October after the end of the tax year in which you started selling goods.
- Go to HMRC’s Self-Assessment registration page to set up an account if you don’t already have one.
- Make sure to keep records of your registration and any correspondence.
- Or we can help with this
Step 3: Contact HMRC
Once you have your information ready, you can voluntarily disclose your income by:
- Filling out a Self-Assessment Tax Return but this comes with certain time limits and you may have missed the boat:
- If your income exceeds £1,000 (the trading allowance), you need to submit a self-assessment tax return and include your online earnings in it. This will be due by 31 January after the end of the tax year (for example, for the 2023/24 tax year, the return is due by 31 January 2025).
- Using the “Voluntary Disclosure” Option: You can also use HMRC’s Voluntary Disclosure service. This is a special process for correcting previous underreporting or non-reporting of income.
- To access this, visit the HMRC Voluntary Disclosure page.
- In this process, you’ll explain the situation and the nature of your income, including whether it was previously declared.
- This is something we can do for you so contact us to help and receved a fixed price quote from us
Step 4: Pay Any Tax Due
When you submit your disclosure, you need to calculate the amount of tax owed based on your declared income. You may also need to pay Class 2 National Insurance contributions if you earn above certain thresholds (£6,725 in the 2023/24 tax year for self-employed individuals) as well as Class 4 NIC.
- You can make the payment for any tax owed directly through the Self-Assessment online system.
Step 5: Keep Accurate Records Going Forward
After your disclosure, make sure to keep accurate and up-to-date records of all your online sales and related expenses. This will help with future filings and ensure you stay compliant in the years ahead.
Contact Andy on 07879 464 577
