Thousands Of Citizens Who Make Extra Money Online Are Targeted By HMRC

An estimated 5 million workers in Britain participate in the so called ‘sharing economy’ by selling products such as accessories, greeting cards, and delicacies, or by offering services online. It follows a massive surge in websites such as AirBnB, Etsy, and eBay wherein they allow sellers to advertise and sell their goods or services directly to customers provided that a cut is paid to them.


These people who are earning extra cash online are now liable for tax on any cash they generate. HMRC stated that it is now pursuing those who fail to declare these earnings by the January 31 deadline and hopes that its crackdown will raise millions of pounds in extra. It is using a powerful new computer system to compile information about taxpayers from ‘marketplace’ websites such as eBay so it can better identify non-taxpayers. In addition, any internet sellers who are found to have owed tax and failed to submit a self-assessment return by the end of this month will face a £100 fine.

It is expected that the taxman will only come after people who operates as a business. Someone selling a small item online, for example, will not be targeted. However, anyone who sells items regularly and starts to make a profit may be classed as a small business by HMRC.

The new rules will start to come in play on April. The rule allows marketplace sellers to earn £1,000 before having to declare anything to the taxman, but this doesn’t apply until then. Undoubtedly, many people earning money through online selling will have no idea that they owe tax. On the other hand, HMRC contradicted this by saying that the majority of the traders in the sharing economy are already declaring and paying their tax just like other taxpayers.