HMRC has begun to increase their focus on online sellers, gig economy workers and influencers for potential unpaid taxes on income that has not been declared ...
The first letter is aimed at those who have sold items or services through online marketplaces, such as eBay or Etsy, or are self-employed drivers that use platforms such as Uber or Lyft. The second letter is specifically targeted at people who have generated income from creating content online, such as authors and influencers.
HMRC has stated that they only intend to contact those whom they believe have earned more than £12,570 from their online sales. However, the exact time period that these earnings were generated is not specified in the letter.
In addition, HMRC will only be able to contact individuals whom they have correctly identified, which may prove to be challenging due to people not always operating under their full given name, or not providing all the necessary information when registering on a marketplace or platform.
The nudge letters state that HMRC believes the individual has not declared all or some of their online income, and ask them to make a disclosure using the digital disclosure service (DDS) if this is the case. It is important to note that the gross sales figure provided by HMRC does not necessarily equate to taxable income.
If an individual has earned over £12,570, but their net income is covered by the personal allowance, they should still register their trade with HMRC and complete a tax return. I advise you to speak to a tax specialist such as myself rather than making an immediate disclosure in response.
If you'd like to find out more about anything I've written here, do call me on 01908 774323 or leave a comment below and let's see how I can help you.