Research commissioned by HMRC into the ‘sharing economy’, defined broadly as economic activity through digital platforms and applications, has found widespread support for the idea that platforms should provide more tax-related information and HMRC should work more closely with platforms, for instance when individuals sign up.
The report, ‘Sharing economy: user characteristics and tax reporting behaviour’, aimed to gain a better understanding of the size of the sharing economy, in terms of both the number of people who participate for profit (providers) and the income they generate.
The research found that around 11% of the 5.3m working age individuals in Great Britain participate in the sharing economy as ‘providers’. This activity generates an estimated total gross income of £8bn annually (with annual mean individual income of approximately £1,700).
The findings suggest that, on the whole, providers seek to comply with their tax obligations. Those earning a greater proportion of their income through sharing economy activities are more likely to report this income to HMRC. However, tax could act as a deterrent for future participation, particularly if the amount payable is considered high compared to the time spent or profits made, or if the reporting process is too complex. See http://bit.ly/2hUOOaW.
Research commissioned by HMRC into the ‘sharing economy’, defined broadly as economic activity through digital platforms and applications, has found widespread support for the idea that platforms should provide more tax-related information and HMRC should work more closely with platforms, for instance when individuals sign up.
The report, ‘Sharing economy: user characteristics and tax reporting behaviour’, aimed to gain a better understanding of the size of the sharing economy, in terms of both the number of people who participate for profit (providers) and the income they generate.
The research found that around 11% of the 5.3m working age individuals in Great Britain participate in the sharing economy as ‘providers’. This activity generates an estimated total gross income of £8bn annually (with annual mean individual income of approximately £1,700).
The findings suggest that, on the whole, providers seek to comply with their tax obligations. Those earning a greater proportion of their income through sharing economy activities are more likely to report this income to HMRC. However, tax could act as a deterrent for future participation, particularly if the amount payable is considered high compared to the time spent or profits made, or if the reporting process is too complex. See http://bit.ly/2hUOOaW.
