UK

Who needs to register with DAC 7 UK?

The due diligence and reporting obligations under DAC7 fall on platform operators, which are the entities that contract with sellers to provide them with all or part of a platform. DAC7 defines a platform as any digital interface that connects sellers of certain qualifying goods and services with potential buyers. The scope is broad and may extend to non-traditional platforms, such as software integrated into a website or online platform.

Which operators do not require registration in DAC 7 in UK?

Platform operators already registered in the EU for DAC7 are not required to register in the UK under the DAC7 Directive. This means that companies registered in one of the EU countries do not need to register in the UK.

Registration process:

• Platform operators must notify HMRC that they are subject to the reporting requirements by 31 January 2025 in respect of the calendar year 2024.
• HMRC will provide an online reporting service, and platform operators will need to register to use this service before submitting reports. This registration will allow them to upload vendor information in a digital format (usually XML files).

The UK rules will apply to relevant platform operators that are resident in, incorporated in, or have their place of management in the UK for tax purposes (although entities established elsewhere may be subject to similar obligations in other jurisdictions).

What type of activity must be reported in the UK?

Under DAC7 rules in the UK, the platform must report the income of sellers engaged in various activities such as live streaming, food delivery, taxi services, and online learning. These rules apply to the trading of goods and the provision of services online.

Deadlines for DAC7 reporting in the UK

The UK's equivalent to DAC7 is called the Digital Platform Reporting Rules (DPRR).

• 31st January 2025: The first reporting deadline for UK platform operators. This is for data collected from 1st January 2024.
• Platform operators must also provide a copy of the reported information to the vendor by the same deadline. This will assist vendors in completing their tax returns.

Penalties for Non-Registration: Failure to register or comply with these obligations can result in penalties. Initial fines can be as high as £5,000, and ongoing daily fines of up to £600 may apply if operators fail to meet their reporting obligations.