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MTD for Resellers: Do eBay & Vinted Sellers Need It?

Checked 29 Oct 2026 against GOV.UK · General information, not tax advice

Who needs Making Tax Digital for Income Tax?

Making Tax Digital for Income Tax is HMRC's new way of doing Self Assessment: you keep digital records and send HMRC a summary every 3 months using compatible software, then submit your tax return through that software. GOV.UK says you'll need to use it if you're a sole trader or landlord who (GOV.UK: find out if and when you need to use Making Tax Digital for Income Tax):

• is registered for Self Assessment
• gets income from self-employment or property, or both
• has qualifying income over the threshold

All three have to apply. Plenty of sellers fall out at the first two: if you're only selling your own unwanted things, that usually isn't trading, so it isn't self-employment income (see HMRC's badges of trade). GOV.UK's Making Tax Digital pages don't mention personal-item sales specifically; the test only counts self-employment and property income.

The thresholds and start dates

Source: GOV.UK, checked 29 October 2026. HMRC says it will review your Self Assessment return and write to you if you need to use Making Tax Digital, but it's still your responsibility to check if you don't get a letter. You still send a normal tax return for the year before you start. Some people can apply for an exemption, for example if they can't use digital tools; GOV.UK has the details.

Qualifying income means sales, not profit

This is the part most people get wrong. GOV.UK says: "Qualifying income is your total income from self-employment and property. This is the amount before expenses (also known as turnover), based on the tax return you submitted in the previous tax year" (GOV.UK: work out your qualifying income).

• It's gross. For a reseller, that's your total sales received, before you take off stock, fees and postage.
• It adds self-employment and property together. GOV.UK's example: £25,000 of rent plus £27,000 from self-employment is £52,000 of qualifying income.
• Wages don't count. GOV.UK says PAYE employment income, your share of partnership income, dividends, the State Pension and private pensions aren't included.

Worked examples

Illustrative figures only, not tax advice.

• £12,000 of Vinted and eBay sales, plus a £30,000 salary. Qualifying income is £12,000: the salary doesn't count. That's under all three thresholds, so no Making Tax Digital, although you still need Self Assessment because you're over the £1,000 trading allowance.
• £22,000 of reselling sales in 2026 to 2027, £6,000 profit. Qualifying income is £22,000, not £6,000. It's over £20,000, so on these figures you'd need Making Tax Digital from 6 April 2028.
• £15,000 of sales plus £8,000 of rent. Qualifying income is £23,000. That's under £30,000 for 2025 to 2026, but if your 2026 to 2027 figures were the same, it would be over £20,000, so from 6 April 2028.

GOV.UK also says that once you're using Making Tax Digital, you can stop if your qualifying income is below the threshold for 3 tax years in a row.

If you do need it: quarterly updates

GOV.UK says your software adds up your digital records every 3 months to make a quarterly update. These are "summaries, not tax returns", and you still finish the year with a tax return through your software (GOV.UK: send quarterly updates). With standard update periods, the deadlines are:

On penalties, GOV.UK says HMRC won't apply penalty points for late quarterly updates during the 2026 to 2027 tax year. After that, a late update gets a point, and 4 points means a £200 penalty.

Budget 2026 and Making Tax Digital

The Budget 2026 overview of tax legislation (28 October 2026) says "the government will not apply late submission penalty points to quarterly updates for the 2027-28 tax year for Income Tax Self-Assessment taxpayers required to join MTD in April 2027", though you still need to send the updates before you can submit your tax return. It also lists new exemptions, such as for people getting qualifying care relief (GOV.UK: Budget 2026 overview of tax legislation and rates, sections 2.36 and 2.37). We found no change to the £50,000, £30,000 or £20,000 thresholds.

The trading allowance is a different thing. Budget 2026 announced that it will rise from £1,000 to £3,000 from 6 April 2027, subject to Finance Bill 2026-27. That affects whether you need to tell HMRC about small amounts of income, not the Making Tax Digital thresholds. See the £3,000 trading allowance explained.

What to do now

• Check your gross sales for the tax year (6 April to 5 April) across every platform. Our free HMRC limit checker adds them up against the reporting rules and the trading allowance.
• Over £1,000 of trading income? Self Assessment comes first: see do resellers need to register for Self Assessment?
• Want to know the tax? Try our side hustle tax calculator for a rough figure.
• Heading towards £20,000 of sales? Start keeping digital records now. Our free profit tracker is a simple place to begin.

Quick answers

Do Vinted or eBay sellers need Making Tax Digital?

Most don't. GOV.UK says you only need Making Tax Digital for Income Tax if you're registered for Self Assessment, get income from self-employment or property, and your qualifying income is over the threshold: £50,000 (from April 2026), £30,000 (from April 2027) or £20,000 (from April 2028). Selling your own unwanted things usually isn't self-employment at all.

Is the Making Tax Digital threshold based on profit or sales?

Sales. GOV.UK says qualifying income is your total income from self-employment and property before expenses, also known as turnover, based on the tax return you sent for the previous tax year. So £22,000 of sales with £6,000 profit counts as £22,000.

Does my salary count towards the Making Tax Digital threshold?

No. GOV.UK says income you get through PAYE as an employee doesn't count, and nor do dividends, the State Pension, private pensions or your share of partnership income.

When does the £20,000 threshold start?

From 6 April 2028, if your qualifying income on your 2026 to 2027 tax return is over £20,000. HMRC looks at the return you send for that year and should write to you, but GOV.UK says it's still your responsibility to check if no letter arrives.

Did Budget 2026 change the Making Tax Digital thresholds?

We found no change to the thresholds in the Budget 2026 overview of tax legislation. It did announce that late submission penalty points won't apply to quarterly updates in 2027 to 2028 for people who must join in April 2027, and some new exemptions, such as for qualifying care relief recipients.

Not sure where you stand?

• Use HMRC's free tool: Check if you need to tell HMRC about additional income.
• Read GOV.UK's guide to finding out if and when you need Making Tax Digital for Income Tax.
• Speak to an accountant or tax adviser. If you're on a low income, the charity TaxAid gives free tax help.

Sources

• GOV.UK: Find out if and when you need to use Making Tax Digital for Income Tax (updated 26 March 2026)
• GOV.UK: Work out your qualifying income for Making Tax Digital for Income Tax (updated 11 September 2026)
• GOV.UK: Use Making Tax Digital for Income Tax – send quarterly updates
• GOV.UK: Budget 2026 overview of tax legislation and rates (sections 1.5, 2.36 and 2.37)
• GOV.UK: Check if you need to tell HMRC about additional income

More guides for UK online sellers

• Do You Pay Tax on Vinted? UK Rules & HMRC Limits 2026 – Own clothes vs reselling, the £1,000 allowance and the 30-sale reporting rule, in plain English.
• Vinted HMRC Form & NI Number Request: What to Do – Why Vinted is asking for your National Insurance number, the end-of-year deadline, and why it doesn't mean you owe tax.
• Vinted Tax Calculator UK: Free HMRC Limit Checker – Check your sales against the 30-sale / ~£1,700 reporting rule and the trading allowance, with a 2026/27 or 2027/28 tax-year switch. It checks limits, not your tax bill.
• eBay HMRC Reporting Threshold 2026: £1,707 or 30 Sales – What eBay counts towards £1,707, what it reports, and why a report isn't a tax bill.
• Got an HMRC Letter About Vinted or eBay Sales? What to Do – A calm step-by-step: check it's genuine, work out if you were trading, and reply on time.
• Free Vinted & eBay Profit Tracker Spreadsheet (UK) – A free download with tax-year tabs, profit per item and a check against the HMRC limits.
• Trading Allowance vs Expenses: Which Should Resellers Use? – The £1,000 allowance or your real costs? Why resellers who track stock costs often come out ahead with expenses.
• Do Resellers Need to Register for Self Assessment? – When reselling counts as trading, the £1,000 rule, and the 5 October and 31 January deadlines.
• Depop HMRC Reporting: Do You Pay Tax on Depop Sales? – What Depop reports, what it asks you for, and Depop's own example of being reported but owing no tax.
• Etsy UK Tax: HMRC Reporting Rules for Sellers 2026 – When Etsy reports you to HMRC, and why things you make to sell usually count as trading.
• Trading Allowance Rises to £3,000: What Budget 2026 Changed – The trading allowance is due to rise from £1,000 to £3,000 from 6 April 2027, subject to Finance Bill. When it starts, who it helps, and why £1,000 still applies until then.
• Why Is eBay Asking for My National Insurance Number? – Why eBay wants your NI number, what happens if you don't give it, and why giving it doesn't mean you owe tax.
• Selling Personal Items on eBay: Do You Pay Tax? (UK) – Clear-outs vs trading, the £6,000 Capital Gains Tax rule for valuable items, and why eBay may still report you.
• Facebook Marketplace & HMRC: Do They Report You? – What we could and couldn't confirm about Facebook Marketplace reporting, what Gumtree says, and why the tax rules are the same either way.
• Am I Trading? HMRC's Badges of Trade for Resellers – HMRC's nine badges of trade with Vinted and eBay examples, plus car boot sales: when selling becomes trading.
• Vinted Pro vs Personal Account: Does It Change Tax? – What Vinted says about Pro and standard accounts, what HMRC actually looks at, and why switching account type isn't what decides tax.
• Side Hustle Tax Calculator UK: How Much Tax Will I Pay? – A rough estimate of the extra Income Tax and Class 4 National Insurance on your reselling profit, comparing the trading allowance with your real costs. England, Wales and NI.
• Telling HMRC About Past Online Sales: Disclosure Guide – Realised you should have declared past reselling income? The routes GOV.UK describes, step by step, and how far back it goes.
• Whatnot UK Tax: Do Sellers Pay Tax and Does It Tell HMRC? – How Whatnot reports UK sellers to HMRC via Ireland, when live-selling income is taxable, Whatnot's fees as expenses, and the £90,000 VAT line.
• TikTok Shop UK Tax: When Sellers Pay and What HMRC Sees – TikTok Shop's 30 orders or €2,000 reporting rule, where to find your MRDP report, and why being reported isn't the same as owing tax.