how are businesses getting away with not being registered since ebay / hrmc crackdown?

[evolingretro]

Is ebay actually cracking down on businesses selling as private sellers to avoid the fees or was it just a scare tactic  ?

I have seen 100s of accounts some on the the front pages who have well over 100kworth of stock  are still registered as private even though they state on their listings they are businesses.

If they get reported to the HRMC and are paying taxes apart from avoiding consumer law and ebay fees will anything else happen to them ?

[podlingsmum2007]

They will need to register with a business account and start paying fees.

[evolingretro]

Thanks , but  I thought the deadline was in October ? There a couple of guitar sellers who I have contacted and they have over 200 odd items ranging from 100 - 3k and even say they have a showroom ( and are a business when contacted ) but still have private accounts to avoid the fees. .. I know ebay said have warned sellers will be reported to the HRMC if they go over certain amounts but will they actually do anything if they are paying taxes ?

[podlingsmum2007]

They will be asked to give their national insurance numbers to ebay.

[roger_roger_over_and_nowt]

Hopefully but i'm not holding my breath 😪

[sml192]

Unfortunately, HMRC will only be concerned with whether sellers are paying the correct amount of tax, and not whether they are legally compliant, so provided the seller is declaring their sales for tax purposes then it is highly unlikely that anything else will happen to them. 

[pulseofthedead]

So if a “private” seller actually pays their taxes to HMRC so above the law in that way, who is enforcing that they should be registered as a business….

[bravergrace]

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@pulseofthedead wrote:

So if a “private” seller actually pays their taxes to HMRC so above the law in that way, who is enforcing that they should be registered as a business….

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eBay will enforce it - but at the point where the government threatens to change the law to make eBay responsible for hosting uncompliant listings on their platform.

[bravergrace]

I suspect that the first round of eBay enforcement against unregistered businesses, showed that the potential gains to eBay (ie fees paid for the shops, listings and FVFs) were, on average, less than the profit gained through the non-compliant sales (promotion fees, eBay's rake-off on the postage etc).

This may seem unlikely, but it would make sense if, when threatened with enforcement action by eBay, these unregistered businesses merely open another private account, using different contact details, or stop listing altogether.  After all, the most clear offenders have more than one address available (their actual high street shop address, and their private home address).

[arkwebus]

In the UK very little seems to be done to get people to comply with regulations.  

If they are "caught" action may be taken. 

As you imply if HMRC gets the correct amount of tax [without all other conditions being met] that may be sufficient.

Do please remember that even if people should be registered as a business tax is only declared and paid on "profit".   For smaller businesses it will be very difficult for HMRC to establish that any declared profit is correct.      @pulseofthedead 

[pulseofthedead]

So basically until the government changes the law then  nothing on here will change….

[santlache_sales]

If someone gets reported to HMRC and they are filing their returns correctly and paying tax, HMRC won't bother a single minute wasting their time over a minor thing like being registered privately or as a business on eBay.

It is up to eBay to police the site, although now they have let the free listings genie out of the bottle good luck with that, as in my line there are hundreds now selling privately with a mass of stock listed.

It seems many didn't hang around and suddenly became private sellers which is hardly surprising, as by making this free to private sellers decision eBay have now totally screwed the market. It was bad enough with their rip-off Promoted items and the manipulation of the search engine, but now it's all over the place and like the wild west.

eBay have totally screwed it up and now don't know how to rectify the damage they have caused.

[podlingsmum2007]

If a seller is registered as a sole trader with HMRC, ebay will force any that are using private seller accounts to change to a business account.

[555njp]

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@evolingretro wrote:

Is ebay actually cracking down on businesses selling as private sellers to avoid the fees or was it just a scare tactic  ?

Not in the slightest, it was just a scare tactic.

I have seen 100s of accounts some on the the front pages who have well over 100kworth of stock  are still registered as private even though they state on their listings they are businesses.

Like so many on here, so have I. I used to report them but 9 times out of 10 EBay says “we have investigated this listing/seller but could find nothing wrong, the listings do not breach any of our policies”.

If they get reported to the HRMC and are paying taxes apart from avoiding consumer law and ebay fees will anything else happen to them ?

Absolutely not and the reporting time frame has just moved back 12 months.

Likely nothing will happen even if they are avoiding tax either to be frank.
It’s like everything in the UK. Not policed, no deterrent, so people ignore the laws.

Prime example:

e-scooters (privately owned) - illegal to use on pavement or public highway (and often used in conjunction with illegal drugs sales as riders can dodge the police).

If caught riding on the road it can attract up to 6 points on a license which can be held over and added to a first provisional license if the offender is under age, plus a £300 fine, plus user can have the scooter confiscated.

Is it policed? No, and that’s why every other teenager is bombing about on one. Parents don’t care, schools don’t care, police are not interested……!
Noticed loads more of them about since Christmas too.

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[555njp]

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@pulseofthedead wrote:

So if a “private” seller actually pays their taxes to HMRC so above the law in that way, who is enforcing that they should be registered as a business….

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No one.
It should be Trading Standards but frankly in the few dealings I’ve had with them in the past they are USELESS (and I’m being polite 😁).
If you tell them something is wrong with a business in that it is breaking the law, ripping people off etc. the usual response is “buyer beware”.

Yeah, really helpful, thanks…!

[kempseykate]

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@podlingsmum2007 wrote:

If a seller is registered as a sole trader with HMRC, ebay will force any that are using private seller accounts to change to a business account.

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No they won't.

All HMRC care about is that tax is being paid. As long as it is, the seller can be registered however they like on ebay, it's of no concern to HMRC.

Also, whilst the law is that ebay have to share sales info with HMRC, I doubt very much that they have to tell them the seller's status, and even if they do, there is no law saying that HMRC need to share info about who is paying/not paying tax back to ebay.

[podlingsmum2007]

Tax is a separate thing to being registered with HMRC as a sole trader. Irrespective of profits and tax on profits, ebay will get reciprocal information from HMRC of a person's sole trader status so yes, ebay will force these to register as a business account.

[papso22]

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@podlingsmum2007 wrote:

Tax is a separate thing to being registered with HMRC as a sole trader. Irrespective of profits and tax on profits, ebay will get reciprocal information from HMRC of a person's sole trader status so yes, ebay will force these to register as a business account.

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You keep saying this, what makes you think ebay will take any action?

[palison_123]

The answer is NO.

HMRC  only care about the tax  and as long as "private sellers " pay it they won`t have an issue .

Ebay aren`t cracking down at all on private sellers ,sellers with multiple shops but with the same listings,Business with several accounts so to avoid paying VAT  and Chinese accounts that  don`t show proper business information .

Has anyone on here reported an account for the above offensives and seen the seller taken down or brought into line?

[kempseykate]

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@podlingsmum2007 wrote:

Tax is a separate thing to being registered with HMRC as a sole trader. Irrespective of profits and tax on profits, ebay will get reciprocal information from HMRC of a person's sole trader status so yes, ebay will force these to register as a business account.

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It's not going to happen.

There is no law requiring HMRC to let ebay know about people's tax status.

Also, don't forget someone could be self employed as a decorator, say, so registered with HMRC, but that would not mean they would need a business account to sell their children's outgrown clothes on ebay.