Platform Tax Reporting

BobRachet

For people who are concerned about the new law that will mean online platforms will be reporting sales data to HMRC there is now an official petition.

https://petition.parliament.uk/petitions/654278

RacingDriver

If people are already paying any tax owed they have nothing to be concerned about - there is no new tax just enforcement of current tax law.

eskbanker

The petition has accumulated the grand total of 11 signatures in its first month at the time of posting!

Perhaps it would attract more interest if the petitioner made a more compelling argument than:

Online "platforms" are now required to verify the ID of "sellers" who sell any type of goods/services. The platform must report the personal details of "sellers" and their sales records to HMRC. Platforms can be fined £5,000 + £600 per day for failing to provide information to HMRC. Platforms will now have to verify the ID of ALL sellers to avoid the heavy fines, possibly making a loss on customers who only sell a few items or passing on this cost to sellers.

BobRachet

RacingDriver said:

If people are already paying any tax owed they have nothing to be concerned about - there is no new tax just enforcement of current tax law.

There are a lot of issues with the law it's not about helping people avoid tax payments, there is already a law to catch people dodging tax online anyway (Finance Act 2011 - Schedule 23).

This is going to apply to any platform by the way, if you look into it you'll find out that your nephew who knocked up a platform over his summer holidays will know have the privilege of taking copies of people's drivers licenses and sending financial information to HRMC. HMRC will then investigate people based on his apparently bug free software. This is the next Horizon scandal.

By the way eBay increased there transaction fees yesterday citing new tax regulatory costs, soon all these platforms will be relocating to other countries, HMRC wont have any powers of investigation and the companies wont be paying any corporation tax. It hasn't been thought trough at all. Given most people earn under the £1000 threshold you have wonder what the point of such thorough surveillance is.

BobRachet

eskbanker said:

The petition has accumulated the grand total of 11 signatures in its first month at the time of posting!

Perhaps it would attract more interest if the petitioner made a more compelling argument than:

Online "platforms" are now required to verify the ID of "sellers" who sell any type of goods/services. The platform must report the personal details of "sellers" and their sales records to HMRC. Platforms can be fined £5,000 + £600 per day for failing to provide information to HMRC. Platforms will now have to verify the ID of ALL sellers to avoid the heavy fines, possibly making a loss on customers who only sell a few items or passing on this cost to sellers.

That's the perspective of a platform, people will have their own reasons.

RacingDriver

BobRachet said:

By the way eBay increased there transaction fees yesterday citing new tax regulatory costs, soon all these platforms will be relocating to other countries, HMRC wont have any powers of investigation and the companies wont be paying any corporation tax. It hasn't been thought trough at all. Given most people earn under the £1000 threshold you have wonder what the point of such thorough surveillance is.

The new eBay regulatory operating fee applies to the UK, Austria, Belgium, France, Italy, Ireland, Netherlands, Poland, Spain, and Switzerland, so hardly just a HMRC issue.

I also believe there is a fairly high threshold before platforms have to include sellers in reports to HMRC, and therefore 'most people' earning under the £1,000 threshold will not be impacted.

eskbanker

Yes, the HMRC guidance clearly excludes low-value/volume sellers, defined as:

Sellers for which the PO solely facilitated less than 30 Relevant Activities for the sale of goods, and for which the total Consideration paid or credited did not exceed 2000 euros during the Reportable Period. Both tests must be met for this exclusion to apply.

https://www.gov.uk/hmrc-internal-manuals/international-exchange-of-information/ieim901630

BobRachet

RacingDriver said:

BobRachet said:

By the way eBay increased there transaction fees yesterday citing new tax regulatory costs, soon all these platforms will be relocating to other countries, HMRC wont have any powers of investigation and the companies wont be paying any corporation tax. It hasn't been thought trough at all. Given most people earn under the £1000 threshold you have wonder what the point of such thorough surveillance is.

The new eBay regulatory operating fee applies to the UK, Austria, Belgium, France, Italy, Ireland, Netherlands, Poland, Spain, and Switzerland, so hardly just a HMRC issue.

I also believe there is a fairly high threshold before platforms have to include sellers in reports to HMRC, and therefore 'most people' earning under the £1,000 threshold will not be impacted.

Europe has something called DAC7 which is the same rules (created by the OECD).

The threshold for the UK and EU is 30 sales or €2,000 the £1,000 threshold is a separate matter for income regardless where is comes from. 

BobRachet

eskbanker said:

Yes, the HMRC guidance clearly excludes low-value/volume sellers, defined as:

Sellers for which the PO solely facilitated less than 30 Relevant Activities for the sale of goods, and for which the total Consideration paid or credited did not exceed 2000 euros during the Reportable Period. Both tests must be met for this exclusion to apply.

I would hardly call 30 sales high volume, seem pretty low volume for a whole year.

eskbanker

BobRachet said:

eskbanker said:

Yes, the HMRC guidance clearly excludes low-value/volume sellers, defined as:

Sellers for which the PO solely facilitated less than 30 Relevant Activities for the sale of goods, and for which the total Consideration paid or credited did not exceed 2000 euros during the Reportable Period. Both tests must be met for this exclusion to apply.

I would hardly call 30 sales high volume, seem pretty low volume for a whole year.

The petition refers to "customers who only sell a few items" - I wouldn't consider thirty to be "a few"!

Obviously such thresholds are essentially arbitrary, so there's always room for debate about exactly how they're calibrated, but that doesn't mean that the principle itself is flawed.

BobRachet

eskbanker said:

BobRachet said:

eskbanker said:

Yes, the HMRC guidance clearly excludes low-value/volume sellers, defined as:

Sellers for which the PO solely facilitated less than 30 Relevant Activities for the sale of goods, and for which the total Consideration paid or credited did not exceed 2000 euros during the Reportable Period. Both tests must be met for this exclusion to apply.

I would hardly call 30 sales high volume, seem pretty low volume for a whole year.

The petition refers to "customers who only sell a few items" - I wouldn't consider thirty to be "a few"!

Obviously such thresholds are essentially arbitrary, so there's always room for debate about exactly how they're calibrated, but that doesn't mean that the principle itself is flawed.

I'm not here to defend the wording of the petition, I am bothered about aspects of the law.