Platform Tax Reporting

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.

The person who brought up the thresholds said he thought it was fairly high, I'm just saying 30 sales is not that high, I am sure you can agree to that.

BobRachet

In any case my concern is having any old website be responsible for reporting income to HMRC, we are currently seeing what happens when substandard software is rolled out for financial reporting, only in this situation there wont be 1 Horizon there will be hundreds.

RacingDriver

I do think 30 sales is high, but do agree that different people will have different opinions on this.

Personally if I sell half a dozen item on eBay a year that would be good going.

How many third party sellers do you know that choose to sell on old websites operated by one-man bands rather than the mainstream eBay, Facebook Marketplace etc.?

eskbanker

BobRachet said:
This is the next Horizon scandal.

BobRachet said:

in this situation there wont be 1 Horizon there will be hundreds.

Ridiculous hyperbole serves no useful purpose whatsoever!

BobRachet

It depends what you are selling, a  lot of hobby musicians can easily sell over 30 songs. This law is so really very general and is going to include a lot of pointless reporting. 

I would have trusted Fujisti with reporting before the Post Office scandal but clearly a big name brand can still make mistakes, not to mention these are are online platforms that hackers will love poking around in and causing all kinds of mayhem. There are plenty of niche platforms around, like dog sitting, car park spaces etc they haven't all got the world's best programmers working for them.

BobRachet

eskbanker said:

BobRachet said:
This is the next Horizon scandal.

BobRachet said:

in this situation there wont be 1 Horizon there will be hundreds.

Ridiculous hyperbole serves no useful purpose whatsoever!

You sound just like the Post Office, what an irony.

eskbanker

Putting aside the silliness, it's obviously unlikely that such recently introduced legislation is simply going to be repealed, but there may be a valid argument that there should be stronger safeguards within its implementation, so that may be a more productive avenue to petition about rather than ambitiously pitching for repeal.  I haven't studied it in any detail, so for those who have, what leads to the belief that it'll be uncontrolled carnage, and what specific improvements would be suggested?

BobRachet

Well if you look at the OECD guidelines they only recommended platforms with 1 million in turnover be included. The UK for some reason have taken that bit out. Putting that back would surely improve the situation.

But you know HMRC already have powers to get this data from any platform they want, so if there is a problem with Onlyfans models or Uber drivers not reporting significant income then make a big show of prosecuting people so they get the message they can't hide. Relying on hundreds of platforms to all report accurately just seems like a huge can of worms.

eskbanker

BobRachet said:

Well if you look at the OECD guidelines they only recommended platforms with 1 million in turnover be included. The UK for some reason have taken that bit out. Putting that back would surely improve the situation.

If you're referring to https://www.oecd.org/tax/exchange-of-tax-information/model-rules-for-reporting-by-platform-operators-with-respect-to-sellers-in-the-sharing-and-gig-economy.pdf, the OECD doesn't recommend that as such, it simply presents an optional carve-out?

BobRachet said:

But you know HMRC already have powers to get this data from any platform they want, so if there is a problem with Onlyfans models or Uber drivers not reporting significant income then make a big show of prosecuting people so they get the message they can't hide. Relying on hundreds of platforms to all report accurately just seems like a huge can of worms.

Obviously the major platforms would be required to participate anyway, but yes, small platforms with low levels of business will no doubt feel aggrieved that they're being lumped in with the big players.  Having said that, it seems inevitable that HMRC would be focusing, initially at least, on the likes of those high profile ones that you mention, rather than paying much attention to dog-sitting or car parking, but it's perhaps unsurprising that the legislation doesn't narrow things down with a view to being broadened later....

This issue was discussed during consultation, so the pros and cons, together with the rationale for the decision not to exclude low-volume platforms, are covered at https://www.gov.uk/government/consultations/reporting-rules-for-digital-platforms/outcome/reporting-rules-for-digital-platforms-summary-of-responses

BobRachet

[Deleted User] said:

BobRachet said:

Relying on hundreds of platforms to all report accurately just seems like a huge can of worms.

I don't understand how.  Let's say a platform reports that A sold £103,187 of stuff, B Ltd sold £34,567 and C sold £1,109.  How does that change anything?  Let's say that they made a mistake with some of the numbers, how does that change anything?  What am I missing?

Because the numbers the platforms send to HMRC get compared to what the person submits on their self assessment. If there is a mismatch HMRC will investigate that person and accuse them of misreporting even if their figures are correct. So just like Horizon you have someone saying there is a problem with the reporting software. You would hope they would be listened to but what if companies or even HMRC do have problems and try to cover it up? Even if they don't you could get millions of people getting automatically sent letters in error.