POCKET £1,000 FROM EBAY SALES

IF YOU are selling old possessions or homemade wares on websites such eBay and Etsy, you can earn up to £1,000 without paying tax.

The so-called tax-free trading allowance applies to people who sell the odd item online, earn extra by renting their belongings or offer services such as dogwalking or gardening.

There is also a second £1,000 tax-free property allowance so you can rent your home out on sites such as Airbnb. To ensure you stay below the threshold remember that the £1,000 allowance applies to income, not profit. Go above this threshold and you’ll have to declare these earnings to HM Revenue & Customs by filling in an annual tax return.

Income tax will then be applied to all your profit, including the first £1,000 of earnings.

The new allowances were introduced last April. In 2016, HMRC gained powers to snoop on eBay and Airbnb customers’ accounts. If you are trading full-time, it will likely check to find out whether your earnings have been declared.