Hello all,
You may have seen that starting January 1 2024, online marketplaces are required by HM Revenue and Customs (HMRC) to report information on UK-based sellers, including their yearly sales transactions, if sellers meet the HMRC reporting threshold.
While there’s no change in who is subject to tax in the UK, we’re sharing information below about the latest HMRC reporting requirements for digital platforms and what it could mean for your shop.
What’s changed
Digital platforms like Etsy must now report information and income to HMRC for UK-based sellers who meet the requirements. We’ll be required to file our first report in January 2025 for sales made during the 2024 calendar year, and qualifying Etsy sellers will receive a copy of the information shared with HMRC.
There is no action required from you right now, and we’ll share more details as they become available from HMRC.
What hasn’t changed for taxpayers
There’s no change in who is actually subject to tax in the UK. For a helpful breakdown of what this new reporting requirement for online marketplaces does and does not mean, check out this video from HMRC.
Additionally, UK-based sellers whose information is shared with HMRC will not necessarily be subject to tax. According to the HMRC if your total income from trading or providing services online was less than ￡1,000 (before deducting expenses) in any tax year, you would not be required to pay tax on the profits. You’ll find a handy tool here that can help you understand your specific situation.
If you have any questions about this, we encourage you to reach out to HMRC directly or consult a tax professional.
This update is intended for informational purposes only. Etsy is unable to provide financial or tax advice. Please consult an expert if you have any questions.
