“Snap it, list it, sell it”. eBay makes it sound easy to sell on their site. But is it really that simple? If your teenager’s thinking of selling on eBay and wondering how to go about it, here’s what you need to know.
Related: How to make money as a teenager
Can you sell on eBay as a teenager?
You must be 18 years old or older to sell on eBay. The company’s user policy is very clear on that point. But with parental permission, your teenager can use your eBay account.
If you’re feeling generous, you could agree to split the free listings between you. Just remember you’ll be legally responsible for everything done with your account.
What to be aware of if your teen wants to sell items on eBay
If your teen wants to start selling on eBay, their online safety is key. Your teenager may be a digital native, but when it comes to teens staying safe online they’re as vulnerable as the rest of us. Get them to visit eBay’s Safety Centre for tips on how to stay safe while buying and selling online.
Here are some online safety steps to take:
Online safety tips
Create a strong password. Make it over eight characters long and include numbers, letters and special characters (if permitted).
Impress on your teen never to share your password with anyone. If they must write it down, get them to do it in code and leave it in a safe place at home.
Activate eBay’s two-factor authentication. Logins from a new device will trigger the generation of a code. Having your password and username won’t be enough for anyone else to get into your account.
Make sure your child always signs out of eBay once they’re done. This is vital if they’re using a public or school computer.
Only communicate via eBay. If someone asks your teen for their email address or phone number, chances are, they’re a scammer.
Watch out for phishing scams. If you or your teenager receive an email or message saying it’s from eBay, be careful. Don’t be panicked into clicking a link.
Only send and receive money through eBay. It’s safer. If someone asks your teen if they can pay by check, money transfer or cash, advise them to say no. You’ll find a list of eBay’s accepted payment methods on their customer service webpage.
Keep an eye on your transaction history. If something doesn’t look right, contact eBay support straightaway.
How can a teen start selling on eBay
You’ve given permission for your teenager to use your eBay account, and now they’re ready to start selling. So how do they go about it?
Help your teenager decide what to sell
Running an eBay shop is like setting up any other business. Your teen needs to find a niche or a gap in the market. But when the marketplace is saturated with people selling pretty much anything, it can be tricky working out how to make money as a teenager.
If they’re stuck for ideas, our article on ways teens can make money online might help. To see what’s hot at the moment, suggest they use tools like Google Trends. It’s also worth looking to see what’s popular on eBay right now so they can offer what’s in demand.
Related: Supply and demand for kids
Help your teen choose the right business structure
Sole proprietor or limited liability company? Choosing the right structure is key for any business. So what’s the difference between the two?
When you start selling on eBay, you’re automatically considered a sole proprietorship. As the account holder, that could cause problems. That’s because, as the sole proprietor, the HMRC makes no distinction between your account and your teen’s business. And that means the company’s tax and legal responsibilities, debts, and losses are solely down to you. Then again this is the simplest and least complicated method.
Limited liability company (LLC)
Forming an LLC may be smarter, but it is a more complicated move as you will have to file a tax return every year. The business is then a separate entity. So if there is a problem, it affects the company, not you or your teen. There are strict rules and requirements around creating an LLC, so check first if it’s right for your family.
Help them pick a business name
Helping your teenager come up with a name for their business can be a fun brainstorming session. As a rule, you want to make it easy to pronounce, easy to spell and reflect your product or service. Stuck for ideas? Try using a dictionary or a name generator site.
When you’ve picked a business name, remember to check that the company name is available for use.
Set up a business account for them
Set up a separate business account. It will protect your personal assets and make it easier for taxes (required for anyone earning £1000+ a year on eBay).
As listings on eBay involve entering into a contract, you can only do this if you are aged 18 years or older. This means even if your teen is selling on your page, as the eBay seller, you’ll receive your payouts in your linked bank account.
Explain how to manage finances and taxes
Managing your finances and taxes are an important part of any business venture. Explain to your teen that although you will be doing the taxes (as the eBay account is registered to your name), it’s important for them to understand what’s happening.
Firstly, you can earn £1000 without declaring it to the HMRC. This is known as the Trading Income Allowance and it is an income allowance of £1000 a year.
Once you are earning above this amount the standard Personal Allowance is £12,570. While you do not have to pay tax on this but will need to do a tax return to the HMRC.
Bear in mind that as the eBay account is in your name, the personal allowance of £12570 takes into account all your earnings, as well as your teen’s business profits on eBay.
Related: Do under 18s need to pay income tax?
How to start an eBay business
It’ll be hard to start an eBay business without something to sell. Where’s your teenager going to source their products? Here are a few suggestions you could make:
Related: How to make a business plan for kids
Clear out their room of things they don’t need or want
Clearing their room of unwanted books, toys, and clothes will achieve two things. Stuff they can sell and a tidy room. Result!
Clear out other rooms
When they’re done with their own rooms, how about clearing out others? Make sure they check with you or their siblings first, obviously. You don’t want your couch sold from under you. (Unless you’re buying a new one.)
Ask neighbours if they have anything to sell
Your neighbours may have junk in their garage up for grabs. Your teen could either sell it on eBay for them for a commission or buy it from them and sell it on.
Flip products on eBay
Flipping (buying something cheap and selling it at a higher price) on eBay could prove a money-spinner. The trick is to start small until they get the hang of it.
They should look for items with poor listings or auctions ending in the early hours of the morning or midweek. There’ll be less bidding competition. (You can get software or sniping websites like Gixen to bid at the last second for you.)
Bundles of goods are worth separating out and flipping too. Games consoles with several games, doll houses with room sets. You can often make more by selling these individually.
Start a Dropshipping business
Dropshipping is great if you want to sell online but don’t have the space to hold inventory. When a customer orders from you, the wholesaler ships direct to the customer on your behalf. It saves you extra shipping costs, and there’s no need to store stock.
Great places to source products
Yard sales, thrift stores and flea markets are great places to source products to sell on eBay. But it takes time. And for teenagers juggling school, sports activities and a social life, that may be in short supply.
Here are some other options they could check out:
Local, online buy and sell groups.
Online storage unit auctions — ekonnect storage auctions
How can your teen get paid into their own account with GoHenry?
With GoHenry, your teen can get paid into their own account. Just set up a direct deposit from your joint business account and their eBay profits can go straight in.
GoHenry is a great way to give teens financial independence. They’ll learn about money management through their own experience in a safe, secure way too. Flexible parental controls give you peace of mind and there’s no risk your teen will go into overdraft.