Web users are set to be targeted by the taxman as HM Revenue & Customs (HMRC) aim to clampdown on major eBay and Amazon traders.
According to Graham Apperley, Tax Director at the Midlands office of national audit, tax and advisory firm Crowe Clark Whitehill, if you have allowed your hobby to turn into a business then you could be in trouble.
Traders will have until June 14 to run with HMRC’s e-Markets Disclosure Facility, a campaign developed by HMRC which is designed to help web traders pay the correct amount of tax.
They then have until September 14 to provide details of tax owed and arrange for payment, including any interest and penalty that may be due. Those complying will get a penalty of no more than ten per cent…or in the cases of some, nothing at all.
Mr Apperley said: “This is a good opportunity to start again afresh, but will many take it?
“The web has the image of being free from extensive tax regulation and some web traders may find it hard to comply with HMRC’s requirements.
“This is compounded by the less than clear dividing line between making a bit of pocket money selling no longer wanted items and being a trader who has effectively turned selling into a full-time job. However, eBay and Amazon is a huge market and HMRC will take a robust line with web traders selling on it.”
HMRC has been recruiting extra investigators while using computer tools to try and track down big players and it seems only a matter of time before someone is made an example of.
“Some web traders may choose to ignore HMRC’s tax deadline, nevertheless HMRC are unlikely to let this pass by.”