Side Hustle Tax: HMRC Received Data on Nearly 4M Online Sellers in One Year, Figures Show

His Majesty's Revenue and Customs (HMRC) took in reports covering 3,988,892 seller accounts during 2025, up 272% on the 1,466,171 it logged a year earlier, according to a Freedom of Information response obtained by the accountancy firm Binder Dijker Otte (BDO). The sales behind those accounts came to almost £55B, more than double the £25.5B logged for 2024.

Two caveats sit on those totals before anyone reads a crackdown into them. HMRC says the figures mix individual sellers with companies, partnerships, trusts, and charities, so the count is not four million people clearing out their lofts. And a report landing at HMRC is not a tax bill or a suspicion of one.

The size of the increase is what has drawn attention, and it is worth seeing beside the year it replaced.

The tax office was blunt when asked. A spokesperson said 'absolutely nothing has changed,' and that occasional sellers of unwanted possessions owe nothing on those sales, while anyone genuinely trading through a website may have to file a Self Assessment return, as before the reporting rules existed.

This does not make the growth meaningless. It marks the first full year in which the department could see the activity directly rather than infer it, which is a different kind of change.

What Sends a Seller's Details to HMRC

Digital platforms have been obliged since 1 January 2024 to gather and hand over details of what their users make. The net is wider than resale sites, catching content sharing, private hire, food delivery, and short-term lets.

The trigger is a volume of activity rather than a profit. An account is reported once it passes roughly 30 sales in a year or earns above €2,000, worth about £1,735 at present and drifting with the exchange rate because the limit is set in euros. Passing it says nothing about whether tax is owed.

That is where most of the confusion starts, because three separate numbers are circulating and only one of them is a tax-free amount.

The trading allowance is the one that matters for a bill. Anyone whose trading income clears £1,000 before expenses has to register for Self Assessment, and the personal allowance of £12,570 then means many of them will owe nothing once they do.

Selling possessions is treated differently from trading. Clearing out a wardrobe is not trading. Buying stock or making goods with the intention of turning a profit is, and the distinction rests on intention rather than on which website was used. One exception cuts across both, since a personal item sold for £6,000 or more can bring capital gains tax into play.

What Changes Next and When

The government has committed to lifting the point at which trading income has to be declared, taking it from £1,000 up to £3,000, with a new digital service for those below the line who still owe something. The allowance itself stays where it is, which is the detail most likely to be lost.

The Treasury expects around 300,000 taxpayers to benefit, with roughly 90,000 owing nothing and filing returns that collect nothing. No date has been set beyond this parliament's end, meaning any time before 2029.

Content creators have the least intuitive position of anyone. Gifted products count as income where there is an agreement to promote them, valued at what they are worth. HMRC's own worked example puts £700 in fees alongside £300 of gifted goods and £200 of advertising revenue, and the resulting £1,200 clears the threshold even though only £900 arrived as money.

BDO's Dawn Register expects the material to be used. She puts the department close to finishing a system that will pull the figures out and analyse them without human involvement, and nudge letters have already reached sellers suspected of under-declaring. The safest reading is not that a new tax has arrived, but that an old one is now considerably harder to overlook.