Bad news for Depop girlies – as of January 1 2024, companies including Vinted, eBay, Depop, and Airbnb are now obliged to collect and share seller information with HMRC as part of a crackdown dubbed the ‘side hustle tax’.

HMRC was already able to request information from UK-based platforms, but now the UK is subject to new, more stringent rules, having signed up to the Organisation for Economic Cooperation and Development (OECD).

Now, platforms will be required to routinely report seller information directly to HMRC. Their first obligation to report information will be at the end of January 2025, and will include information such as the tax ID, bank account details, and the number of transactions made by active sellers.

The government said the new rules would help “bear down on tax evasion”. An HMRC spokesperson added: “These new rules will support our work to help online sellers get their tax right first time. They will also help us detect any deliberate non-compliance, ensuring a level playing field for all taxpayers.”

So, if you regularly feature on @dmdrama or routinely scour charity shops for ugly clothes you can resell for ten times the price, do you need to do anything? It’s unlikely, unless you’re a really active seller. This is because sellers are granted a £1,000 tax-free allowance for ‘trading income’ – so if you’re earning below this threshold, you won’t need to fill in a tax return. In addition, under the rules set out by the OECD, platforms will not be asked to share data about sellers who make fewer than 30 transactions or under £1,735 a year. That said, it’s still worth keeping track of how much you’re earning if you are selling clothes on Depop or Vinted. 

Speaking to the BBC, Adam Jay, chief executive of Vinted, said the changes wouldn’t impact the majority of users. “It's actually quite a small proportion of users of our platform who will trigger this threshold where we need to provide information,” he said. “It’s only those people who are making a profit from selling second-hand items that might be eligible for tax [...] We’ll be actively reaching out to those sellers explaining what the new requirements are and why they exist.”

Some have questioned the decision to go after people making a few hundred quid through side hustles when billionaires regularly evade tax by hiding their money in ‘shell’ companies or investing in real estate. But, duh, the Tories would never do that – ‘don’t bite the hand that feeds you’, etc.