From September 2022, HMRC will change the way VAT assessments are carried out for overseas online marketplace traders. HMRC will start sending VAT assessments instead of asking for information from traders, in cases where information held by HMRC indicates that the VAT returns are inaccurate.
The reason for this change is that HMRC believes it already holds the right information to enable it to raise an accurate assessment, so it does not require traders to send in the same details. The assessments will be sent to the trader’s registered UK address, which may be their agent’s address.
If a trader struggles to pay an assessment, HMRC will work with them to arrange more time to pay. If traders do not pay their assessment or arrange a time-to-pay agreement, HMRC will issue a joint and several liability notice to the hosts of the online platform they trade from.
The marketplace may choose to take steps it thinks is necessary to protect itself from being pursued by HMRC for the trader’s VAT debts. This may include withdrawing permission for them to sell on its website. If this happens, the trader will not be able to trade on the marketplace until HMRC withdraws the notice and it can then take up to six weeks for hosts to allow a trader to use their platform again.
This change is the latest in a string of updates for online marketplaces and traders which operate on these platforms and follows the trend of HMRC seeking to ensure proper and accurate taxation of such traders.
From September 2022, HMRC will change the way VAT assessments are carried out for overseas online marketplace traders. HMRC will start sending VAT assessments instead of asking for information from traders, in cases where information held by HMRC indicates that the VAT returns are inaccurate.
The reason for this change is that HMRC believes it already holds the right information to enable it to raise an accurate assessment, so it does not require traders to send in the same details. The assessments will be sent to the trader’s registered UK address, which may be their agent’s address.
If a trader struggles to pay an assessment, HMRC will work with them to arrange more time to pay. If traders do not pay their assessment or arrange a time-to-pay agreement, HMRC will issue a joint and several liability notice to the hosts of the online platform they trade from.
The marketplace may choose to take steps it thinks is necessary to protect itself from being pursued by HMRC for the trader’s VAT debts. This may include withdrawing permission for them to sell on its website. If this happens, the trader will not be able to trade on the marketplace until HMRC withdraws the notice and it can then take up to six weeks for hosts to allow a trader to use their platform again.
This change is the latest in a string of updates for online marketplaces and traders which operate on these platforms and follows the trend of HMRC seeking to ensure proper and accurate taxation of such traders.
