Vinted and eBay sellers issued warning amid new tax rules

People who sell items on platforms like Vinted and eBay have been issued a warning about tax returns.

A deadline is soon approaching for people who need to complete a tax return, which could include people who make money off the popular 'side hustle apps'.

If you have earned more than £1,000 through selling items online, or by renting out spare rooms using an app like AirBnB, you may need to pay tax.

READ MORE: eBay announces major change that will affect every seller

HM Revenue and Customs (HMRC) is urging people to check whether the rules apply to them as the deadline to register for a self assessment tax return is this week.

The gov.uk website states: "You must tell HMRC by 5 October if you need to complete a tax return and you have not sent one before. You could be fined if you do not."

The reminder comes after HMRC introduced new rules for side hustle platforms at the start of this year, in a bid to crack down on people not paying tax.

From January 1, platforms such as eBay, Airbnb, Etsy, Amazon and Vinted have all been required to share seller information with HMRC. Seller information may include the number of sales someone has made and the amount of money earned.

The rules around paying tax have not changed for sellers. But the new rules around information sharing will make it easier for HMRC to track down those who are not declaring their earnings and paying tax when they need to.

The threshold for earnings is set at £1,000 a year. That means if you earn above this threshold, you may need to register as self-employed and file a self-assessment tax return at the end of the financial year.

Whether you pay income tax on the earnings or not depends on whether you are considered to be trading. People who sell old unwanted items are likely not be classed as traders. However, if you are buying items and reselling them to make a profit, that would be considered as trading.

If you make less than £1,000, your earnings will be covered by the 'trading allowance', which entitles you to earn up to £1,000 tax-free without having to report the income to HMRC or pay any income tax on it.

In a reminder on social media, HMRC said: "Check if you need to register for Self Assessment by 5 October. You might need to if you: Have earned more than £1,000 through a side-hustle. Are newly self-employed. Rent out a property."

The October 5 deadline is for people who have not submitted a tax return before and need to register. The deadline to submit your online tax return once you have registered is midnight on January 31.

According to the gov.uk website you must send a tax return for the last tax year if any of the following applies:

• you were self-employed as a ‘sole trader’ and earned more than £1,000 (before taking off anything you can claim tax relief on)
• you were a partner in a business partnership
• you had a total taxable income of more than £150,000
• you had to pay Capital Gains Tax when you sold or ‘disposed of’ something that increased in value
• you had to pay the High Income Child Benefit Charge

You may also need to send a tax return if you have any untaxed income, such as:

• money from renting out a property
• tips and commission
• income from savings, investments and dividends
• foreign income

If you are unsure, you can use the gov.uk's online tool to check whether you need to submit a tax return.