Do You Pay Tax on Selling Your Stuff Online in Australia?

🛋️ The short answer: probably not🔗

Sold your old couch on Facebook Marketplace? Listed your spare phone on Gumtree? Cleared out a wardrobe full of clothes on eBay? Almost certainly, you don't owe a cent in tax.

The ATO has been clear on this. When you sell personal items you originally bought for your own use, and you're selling them for less than you paid, there's no taxable income and no capital gain. You're not running a business. You're just decluttering.

🎯 The essential: The ATO even has a private ruling on record (EV/1011618258080) concluding that eBay sales of personal items didn't have the characteristics of a business, so the income wasn't assessable under section 6-5 of the ITAA 1997. That's about as direct as the ATO gets.

There's also no special tax that kicks in just because you used eBay, Facebook Marketplace, or Gumtree. The platform is irrelevant. What matters is the nature of what you're doing. If you're the person who sold their old treadmill for $200 after paying $800 for it three years ago, this article is mostly good news for you. Keep reading if you want to understand the edges.

🧭 What the ATO actually cares about🔗

Here's the real question the ATO asks: why are you selling?

Clearing out personal stuff generally isn't taxable. You bought it for yourself, you used it, you're moving it on, and the ATO treats this as a private disposal, not income. Running a reselling operation is different: you're buying things with the intention of selling them at a profit, and that's a business activity, with the profit taxable.

The ATO uses a set of business indicators, drawn from Tax Ruling TR 97/11 and its "Are You In Business" guidance, to work out which side of the line you're on. No single factor is decisive, it's the overall picture that counts.

👀 Does the ATO know about your sales?🔗

This is the question that keeps people up at night. Let's be straight about it. The ATO does run data matching programs on digital platforms, collecting information from a range of third-party sources to cross-check tax returns. So no, you're not invisible.

That said, there's an important nuance worth understanding. The Sharing Economy Reporting Regime (SERR), the ATO's formal framework requiring platforms to report seller data, applies to services like rideshare and short-term accommodation. It doesn't apply to straightforward sales of goods where ownership permanently transfers, so eBay, Facebook Marketplace, and Gumtree goods sales are generally not reportable under SERR.

But here's the thing: if you're just clearing out personal stuff at a loss, there's nothing to hide anyway. The ATO knowing about your $80 couch sale doesn't matter if that sale isn't taxable in the first place. The data matching concern is really aimed at people running undeclared reselling businesses, not someone who sold their old gaming console over summer.

💼 When it does get taxable: the reseller scenario🔗

If you're buying items to flip for profit, op shop finds, wholesale lots, clearance stock, arbitrage, that income is generally assessable and needs to be declared in your tax return.

This is where the hobby vs business question becomes genuinely important. The ATO doesn't give you a free pass just because you're doing it casually or from your lounge room. If the activity has the hallmarks of a business, profit motive, regularity, an organised approach, it's taxable income. We've covered the full ATO test in detail in our hobby vs business guide, worth a read if you're in that grey zone. For more on what you need to declare and how side income is treated more broadly, see our piece on side hustle tax in Australia.

Do you need an ABN? If your reselling activity crosses into business territory, the answer is generally yes. There's no income threshold that automatically triggers an ABN, it's the ATO's business test that matters. Our guide on whether you need an ABN for your side hustle walks through exactly how that works.

What about GST? If your annual turnover from reselling hits $75,000, GST registration becomes compulsory, and you have 21 days to register once you know you've crossed (or are likely to cross) that threshold. Miss it, and the ATO can backdate your registration and charge GST on past sales, even if you never collected it. Our guide on the $75,000 GST registration threshold has the full breakdown.

📈 The CGT angle: selling something you made money on🔗

Most people selling their old stuff online won't need to think about capital gains tax. But there are two scenarios where it can come up.

Personal use assets. If you sell a personal item, a second-hand camera, a boat, a piece of furniture, for more than you paid for it, there's technically a capital gain, and that's a CGT event. But here's the good news for most people: if the item cost you $10,000 or less to acquire, it's exempt from CGT as a personal use asset. The ATO puts it directly: a capital gain on a personal use asset is only subject to CGT if it cost you more than $10,000 to acquire.

🎯 The essential: So your $400 camera that you sold for $600? No CGT. Your $800 couch you sold for $1,000? Still no CGT. The exemption covers the vast majority of second-hand goods people sell online. One more thing: capital losses on personal use assets are disregarded regardless of cost, so you can't claim a loss on your old TV even if you sold it for a fraction of what you paid.

The same personal use asset concept applies in the crypto world too, we've covered that in detail in our piece on the $10,000 crypto personal use asset rule if you want to see how the same framework plays out differently.

Collectables. Collectables, think art, jewellery, rare coins, antiques, stamps, rare books, play by different rules. If a collectable cost you $500 or less to acquire, any capital gain is exempt. Below that threshold, the ATO disregards it entirely. If it cost you more than $500 and you sell it at a profit, that's a taxable capital gain you'll need to report.

✅ Your quick decision checklist🔗

Run through this before you stress about your tax return.

1. Did you buy these items for personal use originally? Yes = you're almost certainly in the clear.
2. Are you selling them for less than you paid? Yes = no capital gain, no income. Done.
3. Are you buying items specifically to resell for profit? Yes = this is likely assessable income. Declare it.
4. Are you doing this regularly and systematically? Yes = the ATO may consider this a business. Check the hobby vs business test.
5. Is your annual reselling turnover approaching $75,000? Yes = look into GST registration urgently. You have 21 days to register once you cross the threshold.
6. Did you sell something valuable for more than you paid? Check the personal use asset and collectables rules above. The $10,000 and $500 thresholds cover most everyday items.
7. Still unsure? Talk to a registered tax agent. The ATO also has a community forum at community.ato.gov.au where you can ask questions and get responses from ATO staff.

❓ Frequently asked questions🔗