HMRC targets online activity as part of latest tax crackdown

In its latest move to crackdown on tax evaders, HM Revenue and Customs (HMRC) wants to collect information from internet companies like Ebay and Paypal, to create a database of British users that have generated income from selling online.

By receiving data relating to millions of internet transactions, the UK Government would be able to assess sales conducted on online platforms, including the Apple and Google app stores.

Information regarding the money people make by renting out rooms, through sites like Airbnb, would also be collected as part of the new proposals.

HMRC will be able to process the names, addresses and revenues of anyone who chooses to use the online arena to make a profit, in order to locate those that do not pay the appropriate tax.

Reportedly, the tax authority will have to update its current databases to increase capacity, so that it is able to manage the information.

Estimates suggest that billions of pounds in tax is lost every year due to unreported online income.

Though individuals who make infrequent sales through sites like Ebay are unlikely to be classed as a trader, they still need to declare any profits they make.

In 2013, HMRC was given the power to obtain credit and debit card data, but it has not yet been given permission to access the information held by online trading sites.

According to the authority, when it is able to use the new powers, it will collect an additional £860m over the course of the next five years.