Online marketplaces ― tackling VAT evasion and requirements placed on marketplace operators

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note looks at the requirements placed on online marketplaces (OMPs) to seek to tackle VAT evasion by sellers using OMPs to facilitate sales. For an overview of the provisions relating to the sale of goods sold via an OMP, including the definition of an OMP, see the Online marketplaces ― overview guidance note.

In-depth commentary on the legislation can be found in De Voil Indirect Tax Service V3.268 and V6.314.

Online marketplaces ― joint and several liability

OMPs are subject to special joint and several liability rules because the risk of VAT being evaded by sellers trading via online marketplace platforms is regarded as high. Where these joint and several liability provisions apply then the online marketplace can be held financially responsible for VAT which has not been declared by a seller using its platform.

Depending on the circumstances, the joint and several liability rules can apply:

•
when there is a non-compliant seller using the online marketplace (that is, a seller who fails to comply

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