Apps like eBay and Airbnb will report your earnings to tax authorities under a new global agreement that came into effect yesterday…
There are many apps that allow civilians to make money, from selling unwanted items to renting out your home for the holidays.
Whether you have to pay tax on this income often varies from country to country and is determined by a complex set of rules. In many countries, goods purchased for personal use can generally be resold tax-free, but there are often limits on the income that can be earned from them before they are classified as trades and subject to tax.
Similarly, you may be able to rent out your home or room without paying taxes for a certain period of time or up to a certain amount, but beyond that limit you must treat it as taxable income.
Many people either don't realize that the income they earn from apps can affect their taxes, or they intentionally fail to declare it. To address both issues, the 38 member countries of the Organization for Economic Co-operation and Development (OECD) have signed a new agreement that allows app owners to automatically share your earnings with your country's tax authorities. .
OECD member These include the United States, the United Kingdom, and many European countries.
Austria, Australia, Belgium, Canada, Chile, Colombia, Costa Rica, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, South Korea, Latvia, Lithuania, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States.
bbc news Report on the implementation status of the regulations in the UK.
The new rules require digital platforms to regularly report revenue sellers passing through their sites. This includes not only the sale of handmade items and second-hand clothing, but also services such as taxi hire, food delivery, freelance work, and short-term accommodation and driveway parking. […]
The government said the new rules would help “deter tax evasion” as sellers on digital platforms will now be treated like traditional businesses.
HMRC [UK equivalent of the IRS] A spokesperson said: “These new rules will support our commitment to helping online sellers get their taxes right the first time. They will also help us detect intentional non-compliance and ensure all It also helps ensure a level playing field for taxpayers.”
The app had until January 1, 2024 to start collecting information, but once 12 months' worth of data has been captured it will not be handed over to tax authorities until early next year.
photograph: Towfiq Babuiya/unsplash
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