Seller Information Statements

Background

From 1 January 2024, under the OECD Reporting Rules for Digital Platforms, UK platform operators have been required to collect and verify certain details of sellers who use their platform. They may also need to report this information to HMRC - and importantly sellers - by 31 January for the previous calendar year.

This is effective from the calendar year 2024, with the first statements being shared in January 2025. It is an ongoing scenario. Transactions that took place prior to 2023 are not in the scope of the rules and will not be reported.

Our page, OECD rules, explains the new digital reporting rules and how they affect platform workers. 

Why have I received a statement?

You received a statement because you are a seller of goods or services on a UK online platform that is required to report your details to HMRC.

Sellers of goods who reach the below values or volume through a particular platform within the calendar year should receive a seller statement:

• Those who earn EUR 2000 (around £1,700) or more, or
• Those who make 30 or more transactions

As the rules are new, platforms may elect to only report any new sellers that joined the platform during the 2024 calendar year for the 31 January 2025 deadline. For the 2025 calendar year onwards (so, the 31 January 2026 reporting deadline onwards), platforms will be required to report all sellers – new and existing.

  We understand that some platforms will include sellers already on the platform as well as new sellers in 2024, in their 31 January 2025 reports. 

What is the point of the statement? 

The requirement for the platform to send a copy of the information reported to HMRC to you is an important feature of the rules. It is intended to help you understand the amount of money you have made and to meet any tax obligations correctly - the information could help you complete a tax return for example.

Although the statement contains the information already shared with HMRC (so may give you the impression that HMRC know everything about your income!), you may still need to tell HMRC about the income you have made yourself.

  Just because you receive a statement, this does not mean the income is taxable/reportable. See How the statement affects your taxes below. 

How will I get the statement? 

Many platforms communicate important information through email or through user accounts. We expect seller statements to be made available via email or to be able to download from your account dashboard. You should therefore keep an eye out for any communications from your platform and make sure your contact information is up to date.   

When will the reports arrive?

The reports for 2024 are set to reach sellers on or before 31 January 2025. The reports for 2025 are set to reach sellers on or before 31 January 2026 and so on. As you may be aware, the date is the same as the deadline for completing your online tax return for the previous UK tax year, for example, 31 January 2025 is the ordinary online filing and payment deadline for tax returns for the 2023/24 tax year.

   For those already registered to complete a tax return and who have access to HMRC’s online tax return system - if you have been keeping good records in line with your legal obligations you should be able to use those to do your tax return without waiting for a seller statement. The statement should really only supplement your own business records.

If, for whatever reason, you are relying on your statement to complete your tax return but don’t get it until close to 31 January, although it is technically possible to receive your statement and file your tax return on the same day this would really depend on how familiar you are with the process and the complexity of your tax situation. You would really need to plan ahead and try and prepare as much of the rest of your tax return in advance. However please be aware that with this approach, you risk missing the deadline due to last minute problems or technical issues with online filing systems. 

If you are not already registered for a tax return, because there is a sequence of events that needs to happen between registering with HMRC and being able to complete your tax return, you may no longer be able to meet the ordinary 31 January deadline. But don’t panic. We cover what the situation is below under Action you need to take. 

How to read the statement

Your statement will probably be divided into two main sections:

1. Seller information: Your name, address, tax identification number (TIN- see below for more information on what this is) and so on. If you are an individual seller, this will be your individual information. If you are an entity seller like a limited company, this will be your business information. More detail is available on GOV.UK.
2. Transaction/income summary including consideration, number of relevant activities, and any fees/commissions/taxes withheld.

  The statements will contain information for the preceding calendar year, broken down on a quarterly basis. Because the UK tax year is not the same as a calendar year (the UK tax year runs from 6 April to 5^th April), the information in the statements will always relate to two different tax years and so you need to think of the information in two chunks:

• 1^st quarter (January – March) information – one tax year
• 2^nd to 4^th quarter (April to December) information – another tax year

So, for the 2024 calendar year, the information in the statement is relevant to two UK tax years as follows:

What does TIN mean?

TIN means tax identification number. To ensure the accurate transmission of data, platforms and the tax authorities need a way to identify their sellers so they ask for a TIN. For individual sellers, HMRC’s guidance says that the TIN will normally be a National Insurance Number, although we understand some platforms may be asking for a Unique Taxpayer Reference (UTR) number instead.

If you have not provided a TIN to your platform already as part of the onboarding process, they may be reaching out to you to obtain it before the 31 January reporting deadline. 

What does consideration mean?

This is the net amount paid or credited to you by the platform. UK platforms will generally pay amounts in UK pounds (GBP) however a few may pay in other currencies. You may need to convert the amount shown on the statement to understand how much has been paid or credited to you in GBP.

The net amount means the amount after deductions. So it will not include any refunds or fees/commissions/taxes withheld from your sales by the platform. These are shown separately (see below). 

What does relevant activity mean? 

The number of transactions you received payment for. 

What are fees/commissions/taxes withheld?

Fees and commissions are the charges that the platform makes to use their platform. These would typically be a tax-deductible expense of running a business when it comes to calculating your taxable profits.

As the UK platforms will typically be VAT registered businesses, they must add VAT to the charges they make to use their platform. Unless you are a VAT registered business, these are treated as just another tax-deductible expense of your business.

So, for example, say you sell an item via an online marketplace for £69. The marketplace charge is £7.61 and this has VAT charged at 20% on top (£7.61 x 20% is £1.52), making the total charge £9.13 (£7.61 + £1.52). Your consideration is therefore £59.87 (£69 less £9.13) and your tax-deductible expense is £9.13

Please note that the taxes withheld are nothing to do with income tax and do not mean that you have already paid income tax on these transactions and cannot be used as a credit or offset against your income tax bill. 

How can I calculate the gross income from the figures provided?

Not everyone that gets a statement will need to do something about tax, but if you do, the starting point for working out your tax position is usually your gross income – not the net amount received. So, you will need to add back the fees/commissions/taxes withheld from your consideration by the platform to get your gross income.

For example:

	Consideration	Fees etc.	GROSS
1st Quarter (January to March)	£120	£80	£200
2nd Quarter (April to June)	£516	£344	£860
3rd Quarter (July to September)	£209	£139	£348
4th Quarter (October to December)	£672	£448	£1,120

What if the information doesn’t look right? 

If you cross reference the figures on the statement with your own records, you may notice some discrepancies. These may be down to:

• Your records not being accurate or complete
• Your records being for the UK tax year not the calendar year.
• Income mismatches - For example, the platforms will count things like tips as income, which you may not think of as taxable. If you use an app with open banking for your record keeping, your app will probably only count money that hits your bank account as income, whereas the platforms will also count money paid or credited to your platform account to spend within the platform and that never gets transferred to your bank account.
• Timing differences – The platform is working on a certain type of ‘cash basis’, i.e. the amount received by you in a particular period, whereas you might be using a different type of basis or different timing of the cash basis. For example if you use an intermediary payment app such as PayPal, the payment to PayPal will be the key date for the platform, whereas the payout from PayPal to your bank account might be the key date for you. HMRC say as long as you are consistent you can use either approach for recording your income.
• Use of substitutes: Some platform operators allow sellers to use substitutes to perform work on their behalf. Although you might not have received all of the income from the statement (because you used it to pay the substitute for their work), unless the platform was aware that you were using a substitute, as far as they are concerned, you will have earned the money yourself. The way to deal with this via your tax return by:
• including the substitute’s income within your own gross income, and
• deducting the payment to the substitute as a business expense.

If you still do not understand the information or think it is incorrect, you should ask the platform for clarification on what has been collected and reported.

How the statement affects your taxes

The OECD reporting rules do not change your tax obligations or introduce new ones. As has always been the case, you are responsible for clarifying whether the money earned from your platform activities is taxable, and if applicable, complying with all relevant reporting obligations that arise.

To help people who are selling goods or services online understand, at a glance, whether their activity is taxable and whether they have any tax issues to deal with, we have developed a flowchart.

What are the key considerations? 

As you will see from our flowchart above, whether you have taxable/reportable income depends on your total activity (which may not be limited to the platform activity on your statement!), and whether you are trading.

In general, most people have to declare their income to HMRC and pay tax on any profits they make. There are however, two main exceptions:

• If you have total trading or miscellaneous income (before expenses are deducted) of up to £1,000 (the trading allowance) and meet the other conditions for the trading allowance to apply; or
• If you are selling personal items that you no longer want or to clear some space. This is unlikely to be counted as trading or miscellaneous income. You do not have to rely on the trading allowance to cover it – the nature of the money means it simply does not fall to income tax. Although very high value sales may be subject to capital gains tax, many sales of personal items are exempt and in any case your capital gains may be within your annual exempt amount.

Am I trading? 

As discussed above, if you are selling goods, it’s unlikely you’ll be trading if you’re selling your own unwanted items, such as if you’re clearing out an attic or refreshing your wardrobe. These examples on GOV.UK can help you decide whether or not you’re trading in this context.

If you are selling services, you may not be trading if you do something very casual or just on a one-off basis. This may be miscellaneous income instead. ‘Miscellaneous’ catches taxable income which does not fall within any other category, such as employment or self-employment. So, it may catch odd jobs that you undertook, that don’t quite amount to a full trade.

This is still taxable income but the way you report it to HMRC may be different to trading income (more on this below under Action you need to take).   

Can I use the trading allowance? 

The trading allowance is a tax-free allowance for total trading or miscellaneous income of up to £1,000 per tax year. You do not need to report or pay tax on any income that is covered by the allowance.

When considering whether you can use the trading allowance to cover your income for the 2023/24 tax year, you would need to understand if it is £1,000 or less. If, for whatever reason, you don’t have any other records, you can use your statement to help you work this out as follows:  

• Identify your gross trading or miscellaneous income for the Quarter 1 (January to March 2024) period from the platform statement (see above for how to work out your gross income)
• Add this to the Quarter 1 gross trading or miscellaneous income from any other statement you have received if you are selling via more than one platform
• You will need to include any gross trading or miscellaneous income you make from selling via overseas platforms, whether or not you get a statement from them. Note that income made from activity that is physically carried on in the UK (even if is for an overseas client or being posted to an overseas address, for example) is counted as UK income not foreign income. Convert any amounts into GBP to include in your calculations
• Check for any other relevant income not captured on statements in the January to March 2024 period – e.g. from other sources outside of platforms or from platforms who have not sent a statement.
• Gather together any gross income amounts for the April to December 2023 period, platform related or not, from other records that you may have. 

  Warning – even if your income is £1,000 or less, you should only use the trading allowance if you meet the conditions and it is beneficial to you – more information is available on our trading allowance page.

Action you need to take

The statement should help you understand your tax position. You need to read the information carefully and keep it for your records. It is likely your situation will fall into one of the following scenarios:

You have received a statement but the amounts are not reportable 

If the amounts are not reportable, you do not need to do anything, other than keep good records.

If HMRC do write to you asking about the income, you can simply confirm, as a matter of fact, what you were or are doing. For example, that you were selling personal possessions only, or that you were trading but earned less than and were able to use the trading allowance and therefore had no reporting obligations. Provided you are keeping good records that clearly demonstrate the nature and value of the items that are being sold and that explain inclusions and exclusions in your workings/reported figures, this should usually be enough.

  If you have been issued with a notice to file a tax return but now don’t meet any of HMRC’s self assessment criteria, then you should contact HMRC and ask them to withdraw any notice to file they have sent.You should not just assume that don’t have to complete it, as this could result in late filing penalties.

You have received a statement and the amounts are miscellaneous income 

You will need to tell HMRC about any miscellaneous income payments (unless they fall under the trading allowance – see the trading allowance heading above), but you may not need to complete a tax return if there is no tax due or HMRC are able to collect any tax owed another way – for example, by adjusting your PAYE tax code (if you have one).

You have received a statement and need to do a tax return – but are not already registered with HMRC

If you are trading, you need to register to complete a self assessment tax return as a self-employed sole trader, if you have not done so already. More information, including about the situation if you are late registering, is available on our website.

   You do not need to set up and register as a limited company if you are trading. Running a limited company is one way of being a business – but not the only way. Depending on individual circumstances, it is generally much more straightforward to be a self-employed sole trader. 

You have received a statement and are registered to do a tax return

Your statement can be a valuable tool to help you do your tax return, particularly if you don’t have other records, for example, because they are lost or destroyed. 

You can use your statement to help you do your tax return in the following ways:

• Work out your gross income. As with the trading allowance, the starting point for your tax return is the gross income. You should follow the steps set out above in ‘How can I calculate the gross income from the figures provided?’ to work out your gross income.
• From this, you can deduct allowable expenses. Your statement should give you a handy summary of the fees/commissions/taxes withheld which are one type of allowable expense. You can find some specific help for gig workers with other allowable expenses including mileage allowances and mobile phones on our website.

  If you haven’t been keeping records of any other allowable expenses, the trading allowance might be able to help you here. Even where you can’t use the trading allowance to cover your income in full, you may be able to use ‘partial relief’ trading allowance instead. This is when you reduce your gross income by a flat amount of £1,000 instead of deducting your actual business expenses. It is beneficial to use partial relief trading allowance if you have low expenses and/you have forgotten to keep individual receipts or evidence of expenditure. There is more information on our trading allowance page.

You can find some other hints to help you do your tax return in our recent news article for gig workers, which is linked to in ‘You might also like’ below.  

You have NOT received a statement

People who fall below the thresholds set out in Why have I received a statement? probably won’t get a statement.

However those who do not get a statement, may still have tax obligations. For example, at the beginning or end of a business venture you could make amounts that fall under the reporting threshold of £1,700 but that exceed the £1,000 trading allowance (see Can I use the trading allowance? above).

  Even if your activity is not reported to HMRC by the platform under the new rules, you still need to check your position, as the money you are making could still be taxable/reportable.

In particular, the following types of people in the gig economy who may not have their income captured in a statement may still need to think about their tax obligations:

• if you are paid outside the platform for some element of your work, perhaps in cash or in kind or gifts;
• if you have a business commercially selling direct to the public in fairs and car boot sales as well as through a platform (for example, if you had an old antique coin business);
• if the online platform account you work under is not in your name, but a friend or relative’s - meaning they will get a statement and HMRC will think the income belongs to them. Note – this is a complex scenario and you should ask HMRC for the best way to deal with this.