Do I Have to Pay Tax on Selling Personal Items?

Many people in the UK sell personal items online or at car boot sales. And some have started asking ‘do I have to pay tax on selling personal items?’ The answer depends on what you’re selling and how often.

Do I Have to Pay Tax on Selling Personal Items for Less Than I Paid?

If you are selling personal belongings, such as second-hand clothes, furniture, or electronics, for less than you originally paid, you usually don’t need to pay tax. These are considered personal possessions, and there’s no profit to tax.

However, if you sell valuable items, such as antiques, jewellery, or art, and make a profit, you might need to pay Capital Gains Tax (CGT). There is a tax-free allowance of £3,000 (as of the 2024/25 tax year) for gains on personal possessions. If your total gain exceeds this, you may owe CGT.

Do I Have to Pay Tax on Selling Personal Items Regularly or as a Business?

If you frequently sell items or buy things to resell at a profit, HMRC may consider you a business. In this case, you may need to register as self-employed and pay Income Tax on your profits. Factors that indicate a business include:

Making items to sell
Buying items specifically to resell
Selling regularly over a long period
Advertising or promoting your sales

If you are running a business, you may also need to pay National Insurance and possibly register for VAT if your turnover exceeds the VAT threshold (£90,000 as of 2024/25).

Keeping Records and Staying Compliant

Even if you believe your sales are tax-free, it’s good practice to keep records of what you sell and how much you paid for items. If HMRC investigates, you’ll have proof that you weren’t trading for profit.

If you’re unsure whether you need to pay tax, speaking to an accountant can help clarify your situation and keep you on the right side of the rules.

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