Etsy reported me to HMRC: do I owe tax?
No. A marketplace reporting your sales to HMRC does not automatically mean you owe tax. Buying imported goods to resell for profit is likely to be trading, so check your own income and tax position separately. Cambridge China Bridge sources products with its own staff in China.
A platform report is not a tax calculation
HMRC says platforms must give sellers a copy of the information reported. That report does not replace your business records or tax calculations. Save the report and check it against your sales records before deciding what you need to declare.
Reporting thresholds are not tax allowances
HMRC’s seller guidance says goods sellers are excluded from reporting when they make fewer than 30 sales in a calendar year and receive less than 2,000 euros for those sales. Both conditions must apply. These are reporting conditions, not a tax-free sales allowance.
For an individual trader, HMRC says to combine income from different trading activities: total trading income above £1,000 in the tax year needs to be declared. Check gross income before expenses, not profit or the bank payout. The trading allowance is for individuals and does not apply to partnership trading income. If selling through a company, ask your accountant to assess the company’s position separately.
Imported resale stock points towards trading
HMRC says buying or making goods to sell at a profit is likely to be trading. Importing stock for resale fits that description; selling unwanted possessions is a different situation. Do not treat unsold stock or a disappointing margin as proof that you have nothing to declare.
Gather sales across your marketplaces and other sales channels, then use HMRC’s online income checker or ask your accountant what to report. Keep the question of declaring income separate from the calculation of tax payable.
Reconcile the report with your own records
HMRC says the platform report covers a calendar year and shows earnings after platform deductions. For an individual’s income check, use the tax year from 6 April to 5 April. Export dated transactions rather than copying the annual report total into your tax calculation.
Compare orders, refunds, fees and payouts, and ask the platform about unexplained differences. Keep factory invoices, freight invoices and import paperwork alongside the sales records. Ask your accountant how to treat costs, stock and any tax deducted. For the import documents, use our import records guide.
Keep sourcing and import questions separate
Ask your accountant to review the seller’s trading income and tax position; ask your sourcing team for the purchase and shipment evidence behind the stock. For the separate import VAT question, see VAT on imports from China.
Before another order, confirm who buys the goods, who imports them and which documents each party will provide. Our guide to sourcing agents, wholesalers and platforms explains those purchasing roles. Cambridge China Bridge’s staff in China can support sourcing and inspections.
Frequently asked questions
Does Etsy reporting me to HMRC mean I owe tax?
No. Reporting does not automatically mean tax is due. Check whether you are trading, what income you need to declare and your own tax calculation.
If my marketplace does not report me, am I tax-free?
Do not assume that. Platform reporting conditions and your own tax obligations are separate. Buying imported goods to resell for profit is likely to be trading.
Is the £1,000 trading allowance based on profit?
No. The income check uses gross trading income before expenses, combined across trading activities. Check eligibility and exceptions; the allowance is for individuals.
Can I use the platform report instead of my accounts?
No. HMRC says it does not replace business records or tax calculations. Reconcile it with dated sales, refunds, fees, payouts and purchase documents.