Selling on Whatnot can be incredibly rewarding—but when it comes to tax, things can get complicated fast. Between tracking live show sales, affiliate commissions, platform fees, and shipping costs, it’s easy to feel overwhelmed.
This guide will walk you through everything UK Whatnot sellers need to know about tax in 2025: what income to declare, which expenses you can claim, when to register for VAT, and how to stay on the right side of HMRC.
Do Whatnot Sellers Pay Tax in the UK?
Yes. If you’re earning money through Whatnot in the UK, that income is taxable.
It doesn’t matter if:
- Whatnot is your full-time job or a side hustle
- You’re selling from home or a warehouse
- You’re making £100 a month or £10,000
If you’re earning over £1,000 per year from Whatnot (before expenses), you must register as self-employed and declare that income to HMRC.
The £1,000 Trading Allowance
There’s one exception: the trading allowance. If your total self-employment income (across all platforms and ventures) is £1,000 or less, you don’t need to register or file a tax return.
But once you cross that threshold, you’re in the tax system.
What Income Do You Need to Declare?
All of it. Here’s what counts as taxable income from Whatnot:
1. Sales from Live Shows
Every sale you make during a live show is taxable income. This includes:
- Items sold via auction
- Items sold at fixed prices
- Items sold during flash sales or “final calls”
2. Private Sales
If you sell items to buyers outside of live shows (via private messages or the Whatnot inbox), that income must also be declared.
3. Affiliate Commissions
If you’re earning commissions by promoting other sellers or brands on Whatnot, that’s taxable income too.
4. Bonuses and Incentives
Whatnot occasionally offers seller bonuses, cashback, or incentive payments. These count as business income and must be declared.
5. Tips and Gifts
If buyers send you tips or gifts through the platform, HMRC considers that taxable income as well.
How Is Whatnot Income Taxed?
Whatnot income is treated as self-employment income, which means you’ll pay:
1. Income Tax
You’ll pay income tax on your profits (income minus expenses) at the following rates for 2024/25:
- 0% on profits up to £12,570 (Personal Allowance)
- 20% on profits from £12,571 to £50,270 (Basic Rate)
- 40% on profits from £50,271 to £125,140 (Higher Rate)
- 45% on profits over £125,140 (Additional Rate)
2. National Insurance Contributions (NIC)
If your profits exceed £12,570, you’ll also pay:
- Class 2 NI: £3.45 per week (£179.40 per year)
- Class 4 NI: 6% on profits between £12,570 and £50,270, then 2% on anything above
Example
You make £30,000 profit from Whatnot:
- Income Tax: (£30,000 – £12,570) x 20% = £3,486
- Class 2 NI: £179.40
- Class 4 NI: (£30,000 – £12,570) x 6% = £1,045.80
- Total tax bill: £4,711.20
Your take-home: £25,288.80
What Expenses Can Whatnot Sellers Claim?
This is where you can make a real difference to your tax bill. HMRC lets you deduct allowable business expenses from your income, and you only pay tax on the profit that’s left.
Here are the expenses Whatnot sellers can typically claim:
1. Inventory / Cost of Goods Sold
The cost of items you buy to resell is your biggest deductible expense. This includes:
- Products purchased from wholesalers, liquidation sales, or auctions
- Sourcing costs (car boot sales, charity shops, etc.)
- Import duties or customs charges (if buying from overseas)
2. Whatnot Platform Fees
Whatnot charges a selling fee on every transaction. These fees are fully deductible.
3. Payment Processing Fees
Any fees charged by Stripe or other payment processors for handling transactions can be claimed.
4. Shipping and Postage
If you pay for shipping labels, packaging materials, or courier services, those costs are deductible.
5. Packaging Materials
Boxes, bubble wrap, tape, branded stickers, thank-you cards—it all counts.
6. Studio Equipment
If you’ve invested in equipment for your live shows, you can claim:
- Ring lights and LED panels
- Cameras and tripods
- Microphones and audio equipment
- Backdrops and display stands
- Props and staging items
7. Home Office Costs
If you run your Whatnot business from home, you can claim a portion of:
- Electricity and heating
- Internet and phone bills
- Rent or mortgage interest (as a proportion of business use)
HMRC offers a simplified flat rate of £6 per week (£312 per year) if you work 25+ hours per week from home, or you can calculate actual costs.
8. Storage Costs
If you rent a storage unit or warehouse space for your inventory, that’s fully deductible.
9. Mileage
If you drive to pick up stock, drop off parcels, or attend sourcing events, you can claim:
- 45p per mile for the first 10,000 miles
- 25p per mile after that
Keep a mileage log with dates, destinations, and business purpose.
10. Software and Subscriptions
Any tools you pay for to run your business are deductible:
- Accounting software (Xero, QuickBooks, etc.)
- Inventory management tools
- Email marketing platforms
- Canva, Adobe, or design subscriptions
11. Marketing and Advertising
If you run ads on TikTok, Instagram, or Google to promote your Whatnot shows, those costs are deductible.
12. Accountancy Fees
Yes—you can claim the cost of hiring an accountant to manage your tax return and bookkeeping.
What You CAN’T Claim
- Personal clothing (unless it’s branded workwear or a costume specifically for shows)
- Non-business meals or entertainment
- Fines or penalties
- Personal purchases disguised as “business research”
HMRC has a simple test: “Is this expense wholly and exclusively for your business?” If yes, you can claim it. If no, or if it’s partly personal, you can’t (or you can claim the business portion only).
When Do You Need to File a Tax Return?
Once you’re registered as self-employed, you must file a Self Assessment tax return every year.
Key Deadlines for 2024/25
- 5th April 2025: Tax year ends
- 5th October 2025: Deadline to register as self-employed (if you started trading in 2024/25)
- 31st October 2025: Deadline to file a paper tax return (not recommended)
- 31st January 2026: Deadline to file online and pay any tax owed
Payments on Account
If your tax bill is over £1,000, HMRC will also ask you to make payments on account—advance payments towards next year’s tax.
You’ll pay:
- 50% by 31st January (the same day your current tax is due)
- 50% by 31st July
This can feel like a double hit in January, so plan ahead and set money aside each month.
Do Whatnot Sellers Need to Register for VAT?
If your taxable turnover exceeds £90,000 in any rolling 12-month period, you must register for VAT.
This includes:
- All Whatnot sales
- Sales on other platforms (eBay, Vinted, etc.)
- Any other business income
Once registered, you’ll charge 20% VAT on your sales and file quarterly VAT returns.
Should you register voluntarily? Maybe. If you’re buying inventory from VAT-registered suppliers, you can reclaim the VAT on those purchases—which could save you thousands. We cover this in detail in our dedicated VAT guide for Whatnot sellers.
Should You Set Up a Limited Company?
Most Whatnot sellers start as sole traders—it’s simple, cheap, and easy to manage.
But once your profits hit around £50,000+, a limited company can be more tax-efficient. You’ll pay:
- Corporation Tax (19%) on company profits, instead of Income Tax (20%–45%)
- Dividends tax (lower rates than income tax) when you take money out
The trade-off: more admin, more compliance, and accountancy costs. It’s not right for everyone, but it’s worth exploring once your income grows.
How to Stay HMRC-Compliant
1. Keep Good Records
You must keep records of:
- All income (Whatnot sales, commissions, etc.)
- All expenses (receipts, invoices, bank statements)
- Mileage logs
- Stock purchases and inventory
HMRC can ask to see these records for up to 6 years, so keep everything organised (cloud-based accounting software makes this easy).
2. Separate Your Business and Personal Finances
Open a separate bank account for your Whatnot business. It’s not legally required, but it makes bookkeeping so much easier.
3. Set Money Aside for Tax
A good rule of thumb: save 25–30% of your profit for tax. Transfer it to a separate savings account each month so you’re not caught short in January.
4. Don’t Miss Deadlines
Late filing or late payment comes with automatic penalties:
- £100 if you’re one day late
- More penalties if you’re 3, 6, or 12 months late
- Interest on unpaid tax
Set reminders well in advance.
5. Get Help if You Need It
Tax doesn’t have to be stressful. An accountant can:
- Maximise your allowable expenses
- File your return accurately and on time
- Advise on VAT, limited companies, and tax planning
- Give you peace of mind
For most Whatnot sellers, the tax savings more than cover the cost.
Common Mistakes Whatnot Sellers Make
1. Not Keeping Receipts
No receipt = no deduction. Even if you know you bought something for the business, HMRC won’t accept it without proof.
2. Mixing Personal and Business Spending
Using the same card for everything makes it nearly impossible to separate business expenses. Keep them separate from day one.
3. Forgetting About Payments on Account
Many new sellers get caught out by the January double-payment. Budget for it.
4. Not Claiming Enough Expenses
Lots of sellers under-claim because they don’t realise what’s allowable. This means you’re paying more tax than you need to.
5. Waiting Until January to Sort Your Taxes
Don’t leave it until the last minute. Keep your records up to date throughout the year and file early if you can.
Final Thoughts
Selling on Whatnot is an exciting way to build a business, but tax compliance is part of the deal. The good news: with the right systems in place, it doesn’t have to be complicated.
Key takeaways:
✅ Declare all Whatnot income—live sales, private sales, commissions, and bonuses
✅ Claim every allowable expense to reduce your tax bill legally
✅ Register as self-employed once you earn over £1,000
✅ File your Self Assessment return by 31st January
✅ Set aside 25–30% of your profit for tax
✅ Consider VAT registration once you approach £90k turnover
Need Help With Your Whatnot Taxes?
At Simplr Accounting, we specialise in helping UK Whatnot sellers stay HMRC-compliant without the stress. From Self Assessment to VAT, bookkeeping to tax planning—we’ve got you covered.
Get in touch today and let’s make your tax simple.