by Nick Robinson | Mar 21, 2013 | Accounting, Business
If you are one of the many people in the UK who currently sell items on the Web, HM Revenues and Customs will soon be taking a closer look at your activities. Last week HMRC announced that it would be using ‘web robot’ software to gather information about online traders.
Although individuals that only occasionally sell items online are not subject to paying tax on their income, the new HMRC ‘bots’ will apparently be able to identify people who are buying and selling online as a trade and not declaring their income or paying any taxes.
HMRC software will look at people selling goods via services such as Google and eBay, then cross-reference this data against their own records and third party data. They will look for anomalies in elements such as bank interest, property income and lifestyle indicators. Once an anomaly has been detected they will presumably conduct a full investigation manually.
In addition, the tax office will also be looking more closely at people working in a range of self-employed professions such as home tutors, fitness instructors, life coaches and plumbers to try and determine if they are paying tax on these businesses.
The HMRC plans have already caused consternation among web privacy campaigners who have described them as “covert surveillance on UK businesses.” There are also concerns about what HMRC will do with the masses of data they compile which is irrelevant to any case they are pursuing.
If you are an online trader concerned about these investigations or you work in any of the professions mentioned earlier that will be subject to greater scrutiny, you should consider specialist advice. Yorkshire Accountancy will of course be happy to help anyone who is concerned about their tax liabilities.