UC LWCRA Ebay/Vinted used items (money into account question)

Moonlady
Moonlady Community member Posts: 53 Contributor
edited October 11 in Universal Credit (UC)

Hello

Mixed age couple still on legacy benefits/ ESA support group (my partner is of state pension age) and am awaiting the migration letter. Now I know I will be moving to the LWCRA and just wanted to ask a question. I have to downsize from a 3 bed house to a 1 bedroom place at some point, so have been selling my own and partners used items on Vinted /Ebay at less than I bought for them to clear the clutter. Also giving a lot of stuff to charity.

These are not items bought to resell it's stuff I have had in my house for over 25 years plus. Also we have not moved in a very long time to have regular clear outs. I have looked at the HMRC website and as it's my own personal items I can sell £6000 worth of items per tax year, without paying any tax on them. (which I am obviously not near that) I know the UC team will look at my bank statements which is fine.
But is there a limit I can have from VInted / Ebay when I am in the LWCRA group coming into my account at all ?

As I just want to make sure everything is clear when I move over.

Many thanks

Comments

  • poppy123456
    poppy123456 Community member Posts: 60,513 Championing

    The items you’re selling are personal items and would be treated as capital/savings and not Income. This applies to ESA and UC when you claim that. The maximum amount of capital is £16,000 and there’s a deduction for Income Related ESA and UC for every £250 or part there of over £6,000.

  • Moonlady
    Moonlady Community member Posts: 53 Contributor
    https://forum.scope.org.uk/discussion/comment/918729#Comment_918729

    Thanks Poppy.

    So for example I sold £3000 worth of items of my own/partners personal items over a year or so that would be treated as capital/savings and not an income.

    I was not sure if it was something like you can have a certain amount of money coming from ebay/vinted per month or such like, before it impacted your payments.

    So when I show the bank statements if required to UC regarding my Vinted/Ebay items that should be fine as it is my own personal items I've sold.

    I use the money just for day to day living as such, like towards the bills. Or anything my partner may need to enhance his life.

    Many Thanks

  • DJ17
    DJ17 Community member Posts: 4 Listener

    Hello, I did exactly the same. I am getting rid off my old items. I stopped doing this because new rules come to light from 1 st of January 2024. From this date eBay and Vinted are obliged to report to HMRC private sellers who either sell more than 30 items in one calendar year or total value in one calendar year is over £1.5 k ( can't remember exactly how much) . This doesn't mean you will have to pay taxes. But it means you will have to fill self assessment form. HMRC will then contact DWP. I am still confused if the cash will be treated as income or as something else. I am worried that this might effect my benefits too. I can't find the definite answer anywhere.

  • whistles
    whistles Community member Posts: 1,605 Championing

    I am interested in this thread so will reply so I don't lose it.

    I had read that the amount was 1700 before you needed to pay tax. However, I believe that is for those who buy to sell as self employed not people having a clear out because they are moving.

    I have sold items that show on my statements that the council have currently. I can update and say if they query it.

    The main thing is do not go over the 6000 as that really will impact your benefits.

    Ebay informing the HMRC is simply because there are people out there buying and selling as a business and not registering a business seller. So the 1700 yearly cap makes sense. Also informing the dwp makes sense as it just makes everything transparent.

    Does UC ask for bank statements when you migrate?

  • DJ17
    DJ17 Community member Posts: 4 Listener
    https://forum.scope.org.uk/discussion/comment/929015#Comment_929015

    You are correct the cap is around £1.7 k. This will apply to private sellers. So anyone registered as a private sellers will have to do self assessment form. It doesn't mean you will pay taxes that will depend on personal situation and how much you earn. I am not concerned about taxes. I am concerned that the money from eBay might be treated as income even though you selling old personal items.

    I believe if you have review DWP will ask for bank statements

  • poppy123456
    poppy123456 Community member Posts: 60,513 Championing
    https://forum.scope.org.uk/discussion/comment/929036#Comment_929036

    That's not correct. You do not need to pay tax on items you sell for yourself, such as personal items or items you have around the home.

    https://www.gov.uk/government/publications/selling-online-and-paying-taxes/selling-online-and-paying-taxes-information-sheet

    For means tested benefits purposes items you sell are treated as capital, not income.

  • DJ17
    DJ17 Community member Posts: 4 Listener

    Thank you. I have read this document before. I think you miss understand my previous response. I am not concerned about taxes I know that selling old items without making any profit will not require to pay taxes. I was just making sure that private sellers are aware that if you sell more than 30 items between January 2024 and January 2025 you will be reported to HMRC and asked to fill the sell assesment form. I am really not interested in eBay passing on my details to HMRC and getting hassle with doing forms. And than being contacted by DWP and explaining myself again. I rather stick to the yearly limit.

    At the beginning of October I have migrated to UC. I am still waiting for my transition to be complete. When I migrated I didn't realise that DWP is asking to see statements from all your accounts. I wasn't aware that selling your own possessions can be seen as capital or income. I am not sure if I am supposed to tell them. I don't want to say anything if it's not relevant especially that most of them don't really know what is happening.

    I appreciate you clarifying that the money is treated as capital.

    If I have a phone interview I am brave enough I will asked them directly.

  • poppy123456
    poppy123456 Community member Posts: 60,513 Championing

    They do this to check that you are not a trader and are not self employed. Once they see that you are selling your own personal items nothing will happen and it will not affect your benefits. No, you do not need to tell UC that you're selling your own items because it's not income. You only need to report when your capital goes above £6,000.

    If your capital is below £6,000 they don't usually ask for bank statements. Please be very cautious about asking for advice from any from UC because they are not benefits advisors and often do not know their own rules. They have been know to give incorrect advice many times.

  • Kimmy87
    Kimmy87 Community member Posts: 739 Pioneering

    The DWP are asking for statements as part of checking several million UC claims, it's nothing to do with the migration process itself.

Categories