More than 16 million people across the UK could find themselves under scrutiny from the tax authority as a major crackdown on side hustle earnings gets underway.
Who is in the Firing Line?
The tax arm of the Labour government, HM Revenue and Customs (HMRC), is implementing changes that affect individuals who earn additional income through platforms like Vinted, Airbnb, Etsy, Amazon Marketplace, Depop, and Facebook Marketplace. This figure represents a staggering 158 per cent increase compared to 2023, when only around 6.2 million people were supplementing their main income with such work.
Data analysis cited by barrister-at-law Patrick Cannon, from research carried out by OddsMonkey, reveals that almost two in five Britons are now earning money on the side. Experts have warned that a significant proportion of this extra income may not be being declared to the tax office.
Understanding the New Rules for 2026
HMRC is urging anyone planning to run a side business in 2026 to check whether they need to report their earnings, as the rules for self-reporting have changed. The authority has emphasised that individuals remain responsible for their own tax affairs.
Confusion has arisen among users of selling platforms, with one Reddit user posting: "Vinted is asking for my National Insurance number, does this mean I have to pay taxes? I barely make money on Vinted - what happens if I ignore this?"
Chartered accountant Abigail Foster has sought to clarify the situation, stating that for many casual sellers, there is no need to panic. "If you're simply selling your own second-hand clothes or household items, you won't owe any tax, even when Vinted shares that data with HMRC," she explains. "This rule is aimed at people who are effectively running a resale business, not those decluttering their wardrobes."
The Risks of Non-Compliance
An HMRC spokesperson issued a clear warning to those whose side ventures are growing. "As your side hustle grows, any unpaid tax might come under the spotlight," they said. "This could lead to an unexpected and possibly very large tax bill if you haven't told us about the extra money you've been earning. That's why it's really important to stay on top of your tax affairs."
The key takeaway is that while selling personal items casually is not taxable, systematic buying and selling for profit is considered a trade. With HMRC receiving more data than ever from digital platforms, the message is clear: assess your activities and declare any trading income to avoid a potentially hefty penalty down the line.
