Selling items online has become something of a grey area for many who previously hadn’t considered the tax consequences of their entrepreneurialism. While rummaging around the attic for a few bits and pieces and selling them on EBay isn’t likely to attract the attention of the HMRC more and more individuals are realising that their online trading has tax implications.
As a result, the HMRC are now chasing traders who hadn’t thought to declare or pay their online trading taxes accumulated in this manner, and consequently it would be advantageous to the tax man if they made themselves known, rather than having to pull information together from a variety of data sources to start a pursuit.
With this in mind the HMRC are to conduct a Q&A session on Twitter next week, where individuals concerned about their tax liabilities can find out exactly where they stand. Furthermore, should they subsequently find that they do owe tax then if they volunteer this information (and of course, pay the outstanding amount) then penalties will be reduced and in some cases even waived.
Following on from the trialling of “nudge” tactics, the HMRC are clearly trying to appear more customer friendly, and this campaign follows hot on the heels of similar activities targeted at medical professionals, plumbers and VAT defaulters.
As Marian Wilson, Head of HMRC’s Campaigns, explains: ““We want to help people trading online to understand when they need to pay tax, and how to do that. This Twitter Q&A will try to answer their questions and clear up any grey areas.”
The HMRC’s venture into social media doesn’t just stop at Twitter, however. They have also recently released a YouTube video that outlines most of the issues related to online traders and this can be viewed at http://www.youtube.com/watch?v=uptdjVD2LgI. Such activities display a greater willingness by the HMRC to interact with their customers, making them more approachable at last.
If you have been trading online and the HMRC has confirmed that you have tax to pay, it is often worthwhile sitting down with a qualified accountant to find out exactly what your position is in order to avoid being liable for further penalties.