January 5. 2024
If you make more than £1,000 (before expenses) through these platforms, you should be declaring and paying tax on it. This £1,000 applies to all trading income, not just online platforms, and applies to property, which means that Airbnb hosts are affected as well.
To reduce tax evasion, from the 1st January 2024, new rules are mandating that websites regularly collect their seller's transaction details and share them with HMRC.
The UK government is treating online platforms more like normal businesses, with those using them subject to the same income tax rules as anyone else. A HMRC spokesperson said that the new rules would help online sellers get their taxes right the first time and detect any deliberate non-compliance, ensuring a level playing field for all taxpayers.
If you're earning under the £1,000 tax threshold, you don’t need to declare it but should keep records of transactions in case HMRC asks for proof. It's always a good idea to keep track of your income and expenses to avoid any surprises come tax season.
Alan Gott, FBTC Manager, comments "HMRC have realised that there is a large proportion of the users of these sites that are not declaring their income and are now actively targeting them. It’s more than likely that HMRC will contact the sellers/landlords/creators and allow them to come forward and correct this omission. If you are one of the taxpayers that have accidentally omitted income then you must act on this quickly, before HMRC open a much more serious enquiry".