eBay Tax Guide 2026/27
Last updated: March 2026 — Rates for the 2026/27 tax year
eBay is the UK's largest online marketplace for buying and selling goods. Whether you sell second-hand items from your home or run a business selling new products, eBay provides access to millions of UK buyers. Occasional sellers and full-time businesses both use the platform.
How Much Tax Will You Pay on eBay Income?
As a self-employed eBay worker you pay Income Tax and Class 4 National Insurance on your profits — not your gross earnings. The £1,000 trading allowance means the first £1,000 of income is tax-free. Above that, you deduct either the allowance or your actual expenses, whichever is higher, to arrive at your taxable profit. Use our side hustle tax calculator to get an instant estimate for 2026/27.
Basic rate taxpayer
20% + 9%
Income Tax + Class 4 NI on profit above £12,570
Higher rate taxpayer
40% + 9%
On profit between £50,270 and £125,140
Trading allowance
£1,000
Tax-free — no Self Assessment below this
Allowable Expense Deductions for eBay
These expenses reduce your taxable profit. Keep receipts for all claims.
Tax Tips for eBay Workers
- Selling personal possessions at a loss is not taxable — only profits from trading (buying to sell, or selling items you have made) are taxable.
- Use the £1,000 trading allowance if your total trading income from all platforms is under £1,000 — no need to report it.
- Take high-quality photos with natural light and write detailed descriptions to maximise your selling price.
- Factor in eBay fees and postage costs before pricing items — a £10 item may net you only £7–8 after fees and postage.
Frequently Asked Questions
Do I need to pay tax on eBay sales?▾
If you are selling personal possessions (items you bought for your own use), you generally do not pay income tax on the proceeds, even if you sell them for more than you paid — though Capital Gains Tax could apply for individual items sold for over £6,000. If you are buying items to resell at a profit, or making items to sell, this is trading income and is subject to income tax above the trading allowance (£1,000).
Does eBay report my sales to HMRC?▾
Yes. Under the OECD's Platform Economy Reporting rules, eBay is required to report seller information to HMRC if you make 30 or more sales in a calendar year or receive €2,000 or more in gross proceeds. This does not mean you owe tax — it simply means HMRC receives the data. You are still responsible for determining whether your sales are taxable.
What is the £1,000 trading allowance?▾
The trading allowance lets you earn up to £1,000 from self-employment or casual trading without paying tax or needing to register as self-employed. This covers all your trading income combined (not per platform). If your trading income exceeds £1,000, you must register with HMRC and file a Self Assessment return. You can choose to deduct the £1,000 allowance instead of claiming actual expenses.
Related Tools & Guides
Benefits Calculator
Low eBay earnings? Check Universal Credit and other benefit entitlements.
Take-Home Pay Calculator
Also have a PAYE job? See your combined income after all deductions.
Side Hustle Tax Guide 2026
Complete guide to Self Assessment, the trading allowance, and Class 4 NI.
Making Tax Digital for Side Hustles
MTD for Income Tax starts April 2026 — what it means for you.