Selling your used clothes on Vinted is a great way to clear space and earn extra money. As your sales get bigger, you might ask yourself whether you need to pay taxes on the money you make. The rules can be confusing, especially with HMRC’s ever-changing guidelines.
If you’re asking how much you can earn on Vinted before paying tax in the UK, the short answer is £1,000 per tax year—thanks to the trading allowance. But there’s more to it than just a simple threshold. Are you selling casually, or has your Vinted account turned into a side business? The difference matters to HMRC.
We will cover all you need to know in this guide, including tax-free allowances and Self Assessment obligations, so you can maintain compliance without worrying.
Understanding the £1,000 Trading Allowance
HMRC’s trading allowance allows individuals to earn up to £1,000 per tax year from casual sales without declaring it. This means if you’re simply selling old clothes, shoes, or accessories from your own wardrobe, you likely won’t owe any tax.
However, this allowance isn’t a free pass for everyone. If your activities resemble a business—buying items specifically to resell, selling in large volumes, or making consistent profits—HMRC may consider this a trading activity. In that case, even earnings below £1,000 could be taxable if they form part of a larger profit-making scheme.
Understanding the Difference: Casual Selling vs. Trading as a Business
When selling on Vinted, HMRC makes a clear distinction between casual sellers and those operating as traders. This distinction determines whether you need to pay tax, so it’s crucial to understand where your activities fall.
What Counts as Casual Selling?
Casual selling typically involves:
Personal Items Only – You’re selling clothes, shoes, or accessories that you previously owned and used yourself.
No Profit Motive – Most items sell for less than you paid, or you break even.
Irregular Sales – You list items occasionally, not as a consistent income stream.
No Bulk Purchases – You aren’t buying items specifically to resell.
Example: Emma sells her old winter coat for £30—less than the £50 she originally paid. Since she’s just clearing out her wardrobe, this is casual selling.
When Does It Become a Business?
HMRC considers your Vinted activity a trade if:
- You Buy to Resell– You source secondhand or discounted items to flip for profit.
- Regular Listings– You add new stock weekly or maintain a steady sales volume.
- Profit-Driven– You price items to make consistent earnings.
- Marketing Efforts– You promote your listings or operate like a small business.
Example: Liam visits charity shops every weekend, buys vintage jeans for £10 each, and resells them for £40. Because he’s actively profiting, HMRC would view this as trading.
Gray Areas: When HMRC Might Investigate
Some sellers fall in between casual and business activity. Warning signs include:
High Sales Volume – Selling hundreds of items yearly, even if they’re personal.
Repeat Customers – Buyers frequently returning to your shop.
Branding – Using a shop name, professional photos, or bulk packaging.
If HMRC suspects you’re trading, they may ask for:
- Proof of original purchases (receipts for personal items).
- Bank statements showing income patterns.
- Records of how you source inventory.
Why This Matters for Tax
- Casual Sellers– Can use the £1,000 trading allowance tax-free.
- Traders– Must register as self-employed, file Self Assessment, and pay Income Tax on profits.
Tip: If unsure, document your sales activity. Better to have records and not need them than face penalties later.
When Do You Need to Declare Vinted Income to HMRC?
Even if you earn under £1,000, there are situations where you must report your Vinted sales:
You’re Already Self-Employed – If you file Self Assessment for other income, you must include all earnings, even below the trading allowance.
You’re Selling as a Business – Regular sales, bulk listings, and profit-driven activity mean you’re trading, not just selling personal items.
You Exceed the £1,000 Allowance: You have to register for Self Assessment and disclose profits if you surpass this amount.
Example Scenarios
No Tax Due: Sarah sells her old dresses for £800—all personal items. She keeps the money tax-free.
Taxable Income: Jake buys vintage jeans, repairs them, and resells for £2,500 profit. He must register as self-employed and pay tax.
What Happens If You Earn Over £1,000?
If your Vinted income exceeds the trading allowance, here’s what you need to do:
1. Register for Self Assessment
You must sign up with HMRC by 5 October following the tax year you exceeded the threshold. For example, if you earned £1,200 in 2024/25, you must register by 5 October 2025.
2. Keep Detailed Records
Track every sale, along with expenses like:
- Original purchase costs (if buying to resell)
- Vinted fees & transaction charges
- Postage & packaging costs
These deductions reduce your taxable profit.
3. Complete Your Tax Return
You’ll need to:
- Report total sales
- Subtract allowable expenses
- Calculate profit
- Pay any tax due by 31 January
Pro Tip: To keep organized, use a basic spreadsheet or accounting program like QuickBooks.
Is Your Vinted Activity Considered a Business?
HMRC looks at several factors to decide if you’re trading. Ask yourself:
Do you buy items specifically to resell?
Selling regularly (e.g., weekly listings)?
Are you making consistent profits?
Do you advertise or promote your Vinted shop?
Have repeat customers?
If you answered yes to multiple questions, HMRC may view this as a business—even if you see it as a side hustle.
New HMRC Rules for 2025: What Sellers Need to Know
Starting in 2025, digital platforms like Vinted must report seller earnings directly to HMRC. This means:
No more hiding under the radar – Even casual sellers may get flagged if earnings seem high.
Easier compliance – Automated reporting reduces errors.
Higher scrutiny – HMRC can now easily spot discrepancies.
If you’ve been avoiding Self Assessment, now’s the time to get compliant before HMRC contacts you.
How to Stay Compliant (Without the Stress)
- Track Everything– Save receipts, note expenses, and keep a sales log.
- Set Aside Money for Tax– Around 20-30% of profits, depending on your tax band.
- Register on Time– Miss the deadline, and fines start at £100.
- Seek Professional Advice– If unsure, an accountant can help optimise deductions.
Smart Strategies to Stay Tax-Compliant on Vinted (Without the Headache)
Navigating tax obligations for your Vinted sales doesn’t need to be stressful. With the correct strategy, you can maximize your profits and maintain good standing with HMRC. Here’s your stress-free guide to compliance:
1. Meticulous Record-Keeping: Your Financial Safety Net
The cornerstone of hassle-free tax compliance is maintaining impeccable records. Implement these practices:
Digital Receipt Management: Use cloud storage or dedicated apps to photograph and store purchase receipts. This proves original costs if HMRC questions your expenses.
Sales Spreadsheet: Maintain a running log with dates, item descriptions, sale prices, and buyer details. Google Sheets works perfectly for this.
Expense Tracking: Record every business-related cost – from postage fees to Vinted’s commission charges. These reduce your taxable profit.
Pro Tip: Set aside 10 minutes weekly to update your records. This avoids frantic last-minute tax season scrambling.
2. Smart Money Management: Preparing for Tax Bills
You must set aside money, unlike in a typical job where taxes are immediately removed. Follow this approach:
Create a Separate Savings Account: Move 20-30% of each sale’s profit here immediately. Basic-rate taxpayers typically need 20%, while higher-rate payers should save 40%.
Quarterly Reviews: Every three months, assess your earnings and adjust savings accordingly. This prevents nasty surprises come January.
Understand Allowable Expenses: You can deduct reasonable costs like:
Item purchase prices (for resale stock)
Packaging materials
Travel expenses to source inventory
Photography equipment for listings
3. Deadline Awareness: Avoiding Costly Penalties
HMRC’s deadlines are non-negotiable. Mark these very essential and critical dates in your calendar:
5 October: If you recently started working for yourself, sign up for Self Assessment.
31 October: Deadline for paper tax returns
31 January: Deadline for online return submission and payment
Late filings trigger automatic £100 fines, with additional penalties accruing over time. Set multiple reminders as deadlines approach.
4. Professional Guidance: When to Seek Help
While many sellers can manage independently, consider professional advice if:
- Your annual Vinted profits exceed £5,000
- You’re combining multiple income streams
- You’re unsure about allowable expenses
- HMRC has queried your returns
A qualified accountant can:
- Identify overlooked deductions
- Help structure your business efficiently
- Handle communications with HMRC
- Potentially save you more than their fee in optimized tax savings
Remember: Investing in professional advice early can prevent expensive mistakes later. Many accountants offer free initial consultations to assess your needs.
Bonus: Stress-Reducing Tools for Vinted Sellers
Simplify compliance with these resources:
HMRC’s Simple Expenses Tool: Calculates allowable deductions
Accounting Apps: QuickBooks, Xero, or FreeAgent automate much of the process
Vinted’s Sales Reports: Export your transaction history for easy reconciliation
By putting these tactics into practice, tax compliance becomes just another controllable part of your Vinted business rather than a cause for concern. The key is consistency – small, regular actions prevent overwhelming year-end workloads.
Common Questions from Vinted Sellers
- “I only made £500—do I need to do anything?”
If it’s personal items, no. If it’s business-related, track it in case you cross £1,000 later.
- “Do I need a business bank account?”
It helps keep personal and company funds apart, but it is not necessary.
- “What if I forgot to declare past earnings?”
Use HMRC’s voluntary disclosure service to avoid higher penalties.
- “Can I deduct shipping costs?”
Yes! Business expenses reduce taxable profit.
Final Thoughts: Stay Smart with Your Side Hustle
Although there are tax regulations, Vinted is a fantastic method to earn additional cash. The £1,000 trading allowance gives casual sellers breathing room, but if you’re running a resale business, compliance is a must.
With HMRC’s new digital reporting rules, staying organised is more important than ever. Keep records, register on time, and if in doubt—ask a professional.
Need Help?
To be sure you are headed in the right direction, schedule a free consultation with Eternity Accountants.
Download our free Vinted Tax Guide for a step-by-step checklist.
