HMRC launches consultation in bid to crackdown on internet tax avoidance

However, HM Revenue and Customs (HMRC) is warning people who haven’t renewed that their payments might stop if they don’t do so before the 31 July deadline.

During the whole renewals period last year, 409,000 people renewed their tax credits and reported changes online.

This failure costs the taxman billions of pounds every year.

“Paypal, the online payment company owned by Ebay”… did you miss the news that PayPal is now a separate company.

HMRC has launched a consultation on extending its powers to collect extra data from firms and individuals.

It means that thousands of Britons who let out their homes on the internet or sell good on eBay without paying tax will be targeted and have their affairs scrutinised.

The front page of the Daily Telegraph will on Saturday carry a story about HMRC’s impending crackdown on eBay sellers in addition to smartphone app stores run by Apple and Google, holiday lettings sites and a raft of other online retail sites.

They will then compare the information with tax returns filed by the businesses and use it to pursue those who have failed to pay.

“Data can be particularly powerful when it is collected from third parties who facilitate trade, either between businesses, or between businesses and consumers”, it said.

“Effective tackling of the hidden economy will ensure a level playing field between those businesses and individuals who comply with their tax obligations and those that do not”, the consultation said. It’s only last month concerns over tax payer privacy were raised over HMRC starting to use cloud based services from Google.

It said it would not seek to find out what people bought online, but rather what was sold and not declared.