VAT on Digital Platforms

I sense the content providers are all paused thinking "ugh...is there another tax free platform we can run way to?"

(06-07-2020 22:51 )Rake Wrote:  ...HMRC methodically go through the various sectors starting with the biggest, lowest hanging fruit first them work their way down the food chain. ...

The recent spate of news pieces OF has received (with articles from both sides of the atlantic) quoting massive figures made by the top content providers has caught the eye of the authorities perhaps. Not all publicity is good publicity after all eh?

(07-07-2020 03:35 )Tumble_Drier Wrote:  Quite a few UK/EU "creators" complaining on Twitter that payouts are frozen and they're seeing a zero balance on their accounts.

If HMRC clobber OF with a bill for 3 years of unpaid VAT + possible penalties this could get very messy very quickly.

The amount of pain they're in will depend on how many of the girls are already VAT registered.

I'm guessing it won't be a big number, but it will be the big earners. So the % of their turnover covered could be quite high.

(07-07-2020 00:29 )marlowe Wrote:  

(06-07-2020 22:31 )tony confederate Wrote:  HMRC would have required them to start charging VAT immediately.

For those moaning about the lack of notice, it's probably worth adding that other platforms which suddenly started started charging VAT didn't provide any notice of it either. I'm thinking of Adultwork, ManyVids, Patreon and most recently Clips4Sale. Like OnlyFans they simply announced it on the day.

Patreon has been doing this for years, I’ve been on there for over a year supporting Jordynne Grace from Impact Wrestling and throughout they’ve charged vat

Just seen this

https://news.sky.com/story/onlyfans-coul...s-12022345

^ Thread branch has been lopped off and re-potted Rammy. Hannah's Pet posted your link yesterday: https://www.babeshows.co.uk/showthread.p...pid2470416

Ah ok

this OF tax thing is interesting i see an explanation on twitter today, it said this,
OF have always been paying there tax but only on the 20% cut they get from what the girl earns, leaving the girls to pay the tax on the 80% that they got,
HMRC has now told OF that they must pay 100% of the tax on the girls total earnings before giving the girls there cut of the money left after tax,
i wonder if some of the girls hadn't been paying all they should so HMRC is removing them from the equation,
interestingly some of the girls now think they will be better off as will be paying less tax each year,

this OF thing is interesting i see an explanation on twitter today it said this,
OF have always paid there tax put only on the 20% cut they get from what the girl earns, the girls have been left to pay the tax on the 80% that they get,
HMRC have now told OF they have to pay tax on 100% of what the girl earns in total,
so they will give the girl her 80% cut of the money after tax,
i wonder if all the girls have been paying everything they should so are taking the girls out of the equation,
interestingly some of the girls now think they will be better off as will be paying less tax each year,

(05-07-2020 10:24 )FanofCamilla Wrote:  I've actually messaged admire me and asked how they handle the VAT, cause if 1 site needs to pay it then surely they all do.

But I wonder if some are just absorbing it & paying it from turnover rather than passing it to directly to the customer.

I don't see how it's possible for a platform to absorb it and pay it from turnover because the VAT would consume almost all of the platform's take.

On a $10 sale for example the platform would take $2 from that sale as their cut but the VAT slice of the sale would amount to $1.67. So instead of taking 20% from each sale the platform would be taking only 3.3% which surely wouldn't be enough to cover their costs.