The taxman has recently begun to obtain data from popular trading websites, including the internet auction site eBay, in a bid to eliminate tax evasion.
Additional legal powers were given to HMRC last year, enabling the tax body to force websites to hand over customer account data, including sales activity, for online sellers.
The move comes as a growing number of individuals are being investigated by HMRC for potential tax evasion, especially if they are seen to be profiting from online activity that can be categorised as a business rather than a hobby.
Currently, approximately 14,000 individuals are suspected of failing to declare profits on their self-assessment tax returns.
Last year, HMRC made a public example of John Woolfenden – an eBay seller who failed to pay almost £300,000 in tax on his DVD and games business – when he was sent to prison for two years.
The tax body is reportedly working hard to find another high-profile case that will help to give the general public a clear message regarding its stance on evasion.
Penalties in the form of “accelerated payment notices” (APNs) will be issued to anyone who fails to comply with legislation, and HMRC also has the power to force sellers to pay tax that is disputed or subject to an inquiry.
If an individual earns more than the tax-free personal allowance – £10,600 for the 2015/16 tax year – then any additional money earned over that threshold must be declared and will be subject to tax.