28 November 2025
The scent of pine and mulled wine is in the air, and towns and cities across the country are twinkling with the lights of Christmas markets. For many creative individuals, this is the perfect time to share their handmade crafts, unique gifts, and festive cards with the world…
However, amidst the festive cheer, it is important to keep an eye on the business side of your stall. HMRC has issued a timely reminder for anyone earning money from their side hustle this December.
Before you get lost in a sea of tinsel and wrapping paper, let us break down what you need to know to ensure your seasonal enterprise is a success, without any unexpected tax demands in the new year.
The Magic Number: Understanding the £1,000 Threshold
The most important figure for any casual seller to remember is £1,000. This is your annual tax-free allowance for trading income, often referred to as the Trading Allowance. If your total income from selling goods or services is £1,000 or less in a tax year (which runs from 6 April to 5 April the following year), you typically do not need to tell HMRC or pay any tax on it.
However, if your earnings from your festive ventures, and any other side hustles, exceed this £1,000 threshold during the 2024-25 tax year (between 6th April 2024 and 5th April 2025), you will need to take a few important steps. You must register for self-assessment as a sole trader, file a tax return, and pay any tax due by the deadline of 31 January 2026.
Selling Your Old Stuff vs. Running a Business
A common point of confusion is the difference between simply clearing out your attic and running a small business. HMRC is clear on the distinction. If you are selling unwanted personal belongings, such as old clothes or books that you no longer need, this is generally considered decluttering and does not usually count as trading. You are typically selling these items for less than you paid for them, and it is not an activity that needs to be reported.
On the other hand, if you are making items with the clear intention of selling them for a profit, that is a trading activity. Whether you are knitting scarves, painting Christmas cards, or making handmade decorations, this counts as a business, and your income contributes towards that £1,000 allowance.
It All Adds Up
It is crucial to remember that the £1,000 threshold applies to your total trading income, not just from one source. For example, if you earn £600 from selling your crafts at a Christmas market and make another £500 from sponsored blog posts or online content, your total trading income is £1,100. As this exceeds the allowance, you would need to register with HMRC, even though no single activity passed the £1,000 mark on its own.
A Note for Online Sellers
This year, those who sell their wares online also need to be particularly vigilant. New rules mean that platforms like eBay, Vinted, and Facebook Marketplace are now required to share sellers' data with HMRC. The taxman has stated that individual sellers who make 30 or more transactions in a year and are paid over approximately £1,700 will have their information passed to them. This does not automatically mean you owe tax, but it does mean HMRC is aware of your activity, so it is wise to be prepared.
HMRC's "Help for Hustles" campaign is designed to offer guidance and support for people in this exact situation. Their website provides a wealth of tips and advice to help you understand your obligations and stay compliant.
So, as you enjoy the buzz of the market and the satisfaction of seeing your creations find new homes, just keep these simple rules in mind. A little bit of organisation now will ensure you can focus on what matters most: a happy, profitable, and stress-free festive season.
