Do I Need to Pay Tax on My Reselling Income in the UK?

Introduction: Hobby or Hustle?

This guide helps you figure out whether your reselling is just a hobby or a full business—and when HMRC will expect tax.

The £1,000 Trading Allowance

You get £1,000 tax-free trading income per year. Under this, no need to report or register. Over it? You must tell HMRC.

When Hobby Becomes a Business

Sell regularly with profit intent or buy to resell? That counts as trading. Once gross income exceeds £1,000, self-employment registration and self-assessment are required .

Recognizing Business Traits

HMRC reviews "badges of trade" like frequency, intent, stockholding, and businesslike operations to classify income as trading.

Declare Income: Allowances or Expenses

Up to £1,000: use trading allowance, no filing needed.

Above £1,000: choose between allowance or tracking expenses—whichever saves you tax.

What’s Changing? £3,000 Reporting Threshold

Soon you'll only need a full tax return once gross trading income hits £3,000, though the tax-free allowance remains at £1,000. Interim earnings will need tax payment via a simplified online system.

Final Tips for Beginners

Track everything: sales, costs, dates.

Stay under £1,000 if you want to stay tax-free.

Register self-employment as soon as you exceed £1,000 gross.

Choose wisely: allowance or expenses—consider expert advice.

Conclusion

Hobby selling is tax-free up to £1,000, but once you turn pro, your tax duties start. Stay informed, keep records, and avoid surprises with HMRC.