Digital Platform Reporting (Side Hustle Tax) Compliance Check

Why this matters

Since 1 January 2024, the Platform Operators (Due Diligence and Reporting Requirements) Regulations 2023 have required UK digital platforms — think marketplaces, ride-hailing and delivery apps, freelance and services platforms, and short-term letting sites — to collect seller information and report earnings data to HMRC annually, implementing the OECD’s Model Reporting Rules (widely known as DAC7 in the EU equivalent). The first reports covering 2024 activity were due by 31 January 2025, and HMRC now shares this data with over 45 other tax authorities. Coverage widened further from 2025 onward as more marketplace and gig-economy platforms crossed the reporting thresholds, catching businesses that run their own booking, resale, or freelance-matching platforms as well as household names like eBay, Vinted, Airbnb, Etsy, and Uber.

The rules created two distinct compliance problems that get conflated in the press as “side hustle tax”: platform operators themselves must run due diligence on sellers (collecting tax reference numbers, verifying identity, and filing an annual report with HMRC by 31 January each year, with penalties of up to £5,000 per seller for non-compliance), while individual sellers and gig workers must understand that HMRC now receives visibility of their platform income and cross-checks it against Self Assessment returns — even though the £1,000 trading allowance and existing tax rules haven’t actually changed. Businesses running any kind of platform that connects third-party sellers or service providers with customers need to check whether they’re in scope as a reporting platform operator, while sole traders and small businesses selling through platforms need to understand what HMRC now sees.

What you'll need

• Whether your business operates a platform, app, or website connecting third-party sellers, freelancers, or service providers with customers
• Whether your business (or you personally) sells goods, services, or lets property through third-party platforms like eBay, Vinted, Etsy, Airbnb, or freelance marketplaces
• Whether you have processes for collecting seller tax reference numbers and verifying identity, if you operate a platform
• Roughly how many active sellers or service providers use your platform annually, if applicable

What you'll get

A personalised compliance report covering: a score out of 100, an executive summary, a list of findings ranked by severity, and a prioritised action plan with timeframes.