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HMRC tax avoidance clampdown targets eBay traders

HMRC tax avoidance clampdown targets eBay traders

The latest steps by the HMRC to clampdown on tax evasion has targeted eBay and Gumtree traders, private tutors and cash in hand traders.

The HMRC estimates that tax evasion costs the treasury in the region of £7 billion every year. The government have responded and invested £900 million in tackling tax evasion, avoidance and fraud. The HMRC are stepping up their efforts and are trawling through their computer systems for anomalies in order to find those who aren’t paying the correct amount of tax.

Last year, a campaign targeting doctors and dentists raised approximately £10 million and plasterers, home tutors, market stall traders and car salesmen have all previously been under the HMRC spotlight. Another amnesty for offshore accounts generated £500 million in unpaid tax.

In the latest campaign, the HMRC are writing to over 30,000 people who they believe are regularly trading online, but may not be paying all of the tax that they owe. At the same time, they are looking into the tax affairs of tradesmen who don’t charge VAT, private tutor and fitness coaches, who have the ability to hide their income.

The letters will offer people the chance to declare any outstanding tax and face a reduced penalty. The letters will be issued around the start of May and people will have until the 14th June 2012 to come forward.

Anyone declaring unpaid tax before the deadline will face a reduced penalty of up to 20% of the unpaid amount of tax. Those who fail to come forward and are later found to be avoiding tax, will face additional fines of up to 100% of the total amount of tax they owe. They may also face criminal charges.

A spokesperson for the HMRC said: “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 and find people, so I urge them to come forward and disclose voluntarily.”