For example, clothes, books or bric-a-brac. Sale of donated goods is the realisation of the value of a gift. For this reason it is not regarded as a trade for tax purposes. This is the case even where the donated items are sorted, cleaned and given minor repairs.

If the goods are subjected to significant refurbishment or to any process which brings them into a different condition for sale purposes than that in which they were donated, the proceeds of the sale may be regarded as trading income and subject to tax. For example, where donated cloth is made into garments for sale, that will amount to a trade.

Full guidance can be found under annex iv of HMRC’s Charities guidance.