Sell on eBay, Etsy? Firms will now report your earnings to HMRC - Why is the UK doing this?

Rocketeer

As my question says - Why has the UK signed up to this? I've been told the USA who is also a member of the OECD has not signed up to it and don't need to do any reporting to their tax authority or has somebody been telling me duff information. If they have, please can you show me an article saying they and every other OECD member has signed up to it.

Hoenir

Rocketeer said:

As my question says - Why has the UK signed up to this?

To collect due taxes from individuals not declaring their income. Companies operating in the UK are obligated to furnish the HMRC with information that is requested. Been like this for decades. Nothing new. 

Emmia

Rocketeer said:

As my question says - Why has the UK signed up to this? I've been told the USA who is also a member of the OECD has not signed up to it and don't need to do any reporting to their tax authority or has somebody been telling me duff information. If they have, please can you show me an article saying they and every other OECD member has signed up to it.

Nothing to do with the OECD, people have been effectively running businesses by trading on these platforms and earning money that should be subject to tax - but not declaring it. There are boards and loads of threads on here about buying and selling on eBay, Etsy, Vinted, etc.

I'm not exactly surprised HMRC has gone down this route, it's easier to get the platforms to collect the tax and pay it to HMRC than getting thousands and thousands of sellers to do it. (they haven't been doing it so far).

Correction - report the sales and therefore potential liability to HMRC

BoGoF

Emmia said:

I'm not exactly surprised HMRC has gone down this route, it's easier to get the platforms to collect the tax and pay it to HMRC than getting thousands and thousands of sellers to do it. (they haven't been doing it so far).

Except that is not what the platforms have been asked to do by HMRC. They are not being asked to pay tax on behalf of ibdividuals but merely report details of sales to HMRC.

Emmia

BoGoF said:

Emmia said:

I'm not exactly surprised HMRC has gone down this route, it's easier to get the platforms to collect the tax and pay it to HMRC than getting thousands and thousands of sellers to do it. (they haven't been doing it so far).

Except that is not what the platforms have been asked to do by HMRC. They are not being asked to pay tax on behalf of ibdividuals but merely report details of sales to HMRC.

To enable enforcement...

BoGoF

Emmia said:

BoGoF said:

Emmia said:

I'm not exactly surprised HMRC has gone down this route, it's easier to get the platforms to collect the tax and pay it to HMRC than getting thousands and thousands of sellers to do it. (they haven't been doing it so far).

Except that is not what the platforms have been asked to do by HMRC. They are not being asked to pay tax on behalf of ibdividuals but merely report details of sales to HMRC.

To enable enforcement...

Yes, but thats not what you originally said.

Emmia

BoGoF said:

Emmia said:

BoGoF said:

Emmia said:

I'm not exactly surprised HMRC has gone down this route, it's easier to get the platforms to collect the tax and pay it to HMRC than getting thousands and thousands of sellers to do it. (they haven't been doing it so far).

Except that is not what the platforms have been asked to do by HMRC. They are not being asked to pay tax on behalf of ibdividuals but merely report details of sales to HMRC.

To enable enforcement...

Yes, but thats not what you originally said.

I've corrected my post already.

Pollycat

Not another thread on this subject:

Read this MSE article:
eBay, Etsy, Vinted and more to share your data with HMRC (moneysavingexpert.com)

Spoonie_Turtle

Pollycat said:

Not another thread on this subject:

Read this MSE article:
eBay, Etsy, Vinted and more to share your data with HMRC (moneysavingexpert.com)

To be fair most of the threads are people panicking about how it will affect them.  This is the first one I've seen looking a bit deeper and then asking WHY.

RFW

Emmia said:

Rocketeer said:

As my question says - Why has the UK signed up to this? I've been told the USA who is also a member of the OECD has not signed up to it and don't need to do any reporting to their tax authority or has somebody been telling me duff information. If they have, please can you show me an article saying they and every other OECD member has signed up to it.

Nothing to do with the OECD, people have been effectively running businesses by trading on these platforms and earning money that should be subject to tax - but not declaring it. There are boards and loads of threads on here about buying and selling on eBay, Etsy, Vinted, etc.

It is to do with the OECD, it's based on their guidelines. The reporting amount 'threshold' is 2000 Euros. The OECD is trying to crack down on international tax evasion. So, I think, the information will be shared across countries.

A little more info on the decision making process here.

HMRC have said that as far as they are concerned there is nothing new.

RFW

Rocketeer said:

As my question says - Why has the UK signed up to this? I've been told the USA who is also a member of the OECD has not signed up to it and don't need to do any reporting to their tax authority or has somebody been telling me duff information. If they have, please can you show me an article saying they and every other OECD member has signed up to it.

I can't find out if the US already do this, have never done this or somewhere in between. I'd also be interested.

It does appear to be voluntary but looks like there are brownie points for signing up to it. As a much larger economy I wouldn't be surprised if the US didn't really care to sign up.

The US tax system is different and possibly more complicated, especially with online selling. Each state has its own tax laws and they vary quite widely across the US, though there are federal taxes. As a mere mortal, albeit with a tiny bit of experience of selling in the US, I could never get my head round the US tax system.