Ebay to hold onto funds and earn interest on our money!

ballisticbrian

I can't see this in "Announcements" Is it private sellers only?

GadgetGuru

ballisticbrian said:

I can't see this in "Announcements" Is it private sellers only?

No change to business sellers. 

LITRG

soolin said:

vacheron said:

For those that run businesses, does this mean that you have been considered to have recieved the money when it is paid from the buyer or from eBay? 

Maybe this is the reason they’re pushing the funds out every three months if you don’t do it? To stop people holding onto it in the account until future tax years, etc?

Business accounts are unaffected. Ebay will still pay out automatically on Tuesdays, but giving businesses a chance to schedule payouts whenever they want, or on demand. It's only private sellers who will have to click a withdrawal button.

The tax situation hasn't changed, it doesn't matter where you store your money - on ebay or in a bank account, you received it when you received it. Again nothing has changed there. 

Hello. We are the Low Incomes Tax Reform Group (LITRG), part of the Chartered Institute of Taxation who are an educational charity. We are not part of HMRC or MSE. Although we can’t give individual advice, you might find our recent report highlighting the lack of guidance about the cash basis for platform sellers useful: https://www.litrg.org.uk/reports/online-platforms-changing-landscape-self-employed. If you require further help, we recommend that you contact a tax adviser, HMRC or one of the tax charities where relevant. You can find more information about where to get help with tax here: https://www.litrg.org.uk/tax-nic/getting-help-tax. Thanks.

TripleH

RFW said:

Just on one point on the title of the thread, it's an offence for a company to earn money on "held" funds. If they do earn interest then they should pay it to the client.
It stems from solicitors holding money on property exchanges but applies to any company holding client money.

A correction, they cannot keep the money.

What often happened was that the interest was a few pence so the client was asked if the money could be donated to charity.

Unless you have a specific account for specific client money, it can be quite hard to determine how much interest is earned. A lot of client funds end up in 1 account, which is why you are asked to include a reference when you transfer funds in.

RFW

TripleH said:

RFW said:

Just on one point on the title of the thread, it's an offence for a company to earn money on "held" funds. If they do earn interest then they should pay it to the client.
It stems from solicitors holding money on property exchanges but applies to any company holding client money.

A correction, they cannot keep the money.

What often happened was that the interest was a few pence so the client was asked if the money could be donated to charity.

Unless you have a specific account for specific client money, it can be quite hard to determine how much interest is earned. A lot of client funds end up in 1 account, which is why you are asked to include a reference when you transfer funds in.

As far as I know they have to have a separate client account. I'm no lawyer so I don't know if there are loopholes in getting agreements but I know the FCA take it seriously. There looks like there could be some ways around it but in regards to Ebay they're doing it to get private sellers to spend the money they've taken on sold goods.

The Law Society guide for solicitors is below and below that the FCA rules on it.

https://www.lawsociety.org.uk/topics/client-care/client-funds

https://www.handbook.fca.org.uk/handbook/CASS/7/11.html