If you were thinking about clearing out your unwanted clothes, you may also need to think about tax.
From 1st January 2024, digital platforms such as eBay, Vinted and Depop have to pass on more info about how many sales sellers make and the income that arises from that.
This was initially met with alarm as it made headlines and went viral, with many eBay sellers, Depop fashionistas and Vinted wardrobe warriors sent into a panic about whether or not they needed to pay tax on their use of such apps.
But is this a cause for concern? Should you still sell your clothes online?
Don't Let The Ebay Vinted 'Tax' Stop You Clearing Out Your Wardrobe
'Side Hustle Tax' is for... Side Hustlers
The bottom line is that the tax implications were always there for 'trading' items, i.e., deliberately buying and selling clothes to make a profit. In the UK you have a £1,000 tax-free trading allowance which allows you to make some money doing odd jobs, or buying and selling clothing for example.
As you can see below, the only people that really need to be worried about this so-called 'side hustle tax' are the people who are trading, i.e, people buying and selling clothes to make a profit.
Two criteria that mean digital platforms pass on your info to HMRC are:
- selling 30 or more items a year.
- earning over €2,000 (currently around £1,700) over a year. If you earn less than £1,000 in total from things like selling clothes online, you probably don't need to tell HMRC about it.
Martin Lewis Explains eBay, Vinted Sales Tax
This is a really succinct video from Martin Lewis who helps to explain the tax implications of buying and selling clothes online.
Are you worried about the Etsy, eBay, Vinted, etc. sales tax – I hope I can put your mind at rest.— Martin Lewis (@MartinSLewis) January 12, 2024
Please share with anyone this impacts
You can watch back the full @itvMLshow here on ITVX: https://t.co/V2Ez0svipp pic.twitter.com/swbozdiP7F
In Short, Keep Selling Your Unwanted Garments
If you like to make some room in your wardrobe by selling unwanted clothes, you may well get near the 30 items a year mark. But even when eBay passes that info onto to HMRC, so long as you're not deliberately trading, and you're using less than £1,000 of your personal trading allowance, you should be ok.
Above £1,000? Yes you are eligible to pay tax on any profits made about that.
So if you find it easier to slim down your wardrobe by listing each item for just a few quid on Vinted, go for it.
Read More: 20 Signs You Have Too Many Clothes
What Can You Do Instead With Surplus Clothing?
If you're coming close to the threshold above, or you simply do not want to sell your clothes, there are so many options to make use of old clothes.
Pass it On
The best way to make use of old clothing is to pass it on so somebody else can wear it. After all, that's what it was originally made for.
Why not pass on a jumper or pair of jeans to a family member or friend?
Or you could attend a local clothes swap event. Clothes swaps also a great chance to find some new-to-you clothes to fall in love with. This may or may not be a bad thing depending on how much wardrobe space you have!
Don't forget to donate good quality clothing to local charities. Some charities will sell on the clothes to raise money for their cause. But other charities will pass on quality warm clothing to those who need it most. Either way, it is much better than clothes wasting away in your wardrobe.
Alter or Repair Clothes
Are you thinking of selling a dress just because it doesn't fit you anymore? Try taking it to your local seamstress and see what can be done to get that tailor-made fit. Equally, don't let a rip or tear put you off your most-loved clothes. Often clothes can be fixed fairly cheaply and invisibly.
If you're willing to have a go yourself, you could attempt some visible mending and celebrate the flaws of a garment. Textile artist Hayley Mills-Styles has some great advice on visible mending.
Sometimes items need a more radical approach. If you like the pattern or colour of a particular garment but dislike the cut, think about how you might transform it. Again it might be helpful to reach out to an expert upcycler, seamstress or tailor.
Sending your clothes to textile recycling should be a last resort. While it is much better than sending them to landfill, this is still where some clothes end up even if they've been dutifully dropped off at your local textile recycling bin.
SWISH your unwanted clothes
If you're looking for an easy way to get rid of unwanted clothes, then you can fill up a free bag from SWISH.plus and drop it off at your nearest InPost locker. That's it.
Your items need to be good quality, clean and in good condition. But SWISH handles the rest of the process, whether that's donating the items to charity or selling them online. When your clothes sell online, SWISH passes on the rewards to you either in the form of a voucher, or you can choose to donate the proceeds to your favourite charity.
Request your free bag today and take back your wardrobe!
Summary: Keep on Flogging your Old Clothes
For most people, there's nothing to worry about when it comes to selling a few pieces of old clothing. It can be a really good way of making sure that your item goes to a good home.
Even if you choose to stop selling your clothes online, there are other ways of finding new homes for them. You can pass them on to friends/family, donate them to charity, repair or alter them or even upcycle them entirely.
Whatever you do, keep clothes being worn and circulation. In the UK we have a shocking number of unused clothes languishing in the back of our wardrobes. Let's wear them and enjoy them, or move them on so somebody else can.