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Martin Lewis on Wednesday defined the new HMRC rules to anyone making money by promoting on websites like eBay, Vinted, or Airbnb.
The MoneySavingExpert.com (MSE) web site founder wrote On X/Twitter: “In brief, there is no new tax. Unless you are ‘trading’, selling your old stuff isn’t taxed.
“Only sales over £1,700 or more than 30 items a year are reported.”
The money-saving knowledgeable assured online sellers that he would “put their mind at rest” following the implementation of new rules requiring web sites to share their particulars with the federal government.
Starting from 1 January, web sites and apps that facilitate customers in incomes money by means of promoting or renting are required to report the earnings made by their customers to His Majesty’s Revenue and Customs (HMRC).
On MSE web site, an article that Mr Lewis shared on X, learn: “The platforms will have to start automatically sharing this information with HMRC by 31 January 2025 – the first lot of data-sharing will cover the current 2023/24 tax year, which is why it’s worth getting on top of it now.
“Previously, HMRC was able to access sellers’ information from UK-based online platforms when required. The new, automatic data-sharing process, which also covers overseas platforms, is being implemented after the UK signed up to rules by the international Organisation for Economic Co-operation and Development, which aim to tackle tax evasion globally.”
MSE added: “If all you’re doing is selling goods online, firms will ONLY pass on data to HMRC automatically if you’re selling 30 or more items a year OR have total earnings over the equivalent of €2,000 (currently around £1,700) – so if you’re doing a lot less than that, it isn’t an issue. However, it’s worth noting you may still have to pay tax if you earn £1,000 or more from selling.”
The new measures don’t apply to cashback websites, comparable to Quidco and Topcashback, as cashback will not be taxable, he stated.
“It’s important to note that the rules around who pays tax on earnings made from digital platforms have NOT changed. If you didn’t owe any tax on these earnings before, and you continue to use these platforms the same way, you won’t have to start paying tax on them now,” the MSE web site added.
“What has changed is that HMRC will be able to find out what people are making on digital platforms more easily, so now is a good time to check if you owe tax or if you may do so for future earnings.”
The change additionally signifies that HMRC can share this information with tax authorities in different nations which can be signed up to the new rules, and vice versa.
“So if you are living in the UK and making money on a platform that’s based in another country, the tax authority in that country will be able to let HMRC know about this. It’s not clear yet which countries are signed up, though it’s expected to include most EU member states.”
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