HMRC gets tough with eBay tax evaders
HM Revenue and Customs has announced plans to crack down on eBay traders and private tutors failing to declare revenue for tax purposes.
Using new technology, HMRC is planning to hunt out potential tax evaders in these areas over the next two years.
Anyone selling on eBay or similar online markets should declare their income and profit from this if they are buying and selling goods for trade purposes.
In addition, private tutors, whether payment received is the main source of income or secondary and regardless of if they have formal qualifications or not, are being warned they could also be guilty of tax evasion. This could include instructors such as fitness and lifestyle coaches too.
HMRC is using advanced software to help trace those who are trading without paying tax. Mike Wells, director of risk and intelligence at HMRC is urging people who suspect they may need to pay tax to come forward – or risk further penalties: "We will use the information we gather to pursue people who choose not to use the opportunities we provide for them to put their affairs in order on the best possible terms.
"It will be more expensive if we come to find people, so I urge them to come forward and disclose voluntarily."
Patrick Connolly, spokesperson for independent financial advisers AWD Chase De Vere, says HMRC's action is sensible but warns there could be unsuspecting tax avoiders: "This clampdown could impact on those who are earning through their profession or even potentially through their hobby.
"It doesn't mean that anybody buying and selling on sites such as eBay will need to pay tax, but for regular traders, those dealing in more expensive goods or those who buy with the intention of selling on at a higher price, then they could face a tax liability."