At the onset of the year, a Royal Decree was passed, delineating the procedures outlined in the European Directive known as DAC 7. This directive has implications for individuals engaged in habitual buying and selling activities on second-hand platforms like Wallapop.
To register as self-employed, one must demonstrate the habitual nature of their economic activity, which applies to sellers using these platforms. Additionally, these platforms are mandated to collect and report information to the tax authorities of the country, such as the Spanish Tax Agency (Hacienda), regarding sellers who exceed established thresholds. Let’s delve deeper into this matter.
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The Obligation of Second-Hand Sales Platforms to Inform Tax Authorities
The legislation that came into effect in 2023 targets digital platforms, compelling them to communicate data pertaining to economic activities. The Royal Decree stipulates that they must report on so-called ‘relevant activities.’
Specifically, they are required to disclose data related to the transactions in which they mediate, including the identification of platform operators and sellers, remuneration, and identification of financial accounts used for payment, as well as taxes, fees, and other amounts withheld or charged by the operator, among other details.
Platforms like Wallapop or Vinted are obligated to furnish Hacienda with banking information, quarterly earnings, number of sales per quarter, and fees, taxes, and commissions collected or withheld.
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The New Regulations Will Not Affect All Self-Employed Individuals Selling on These Platforms
It’s crucial to note that the DAC7 regulations will not impact all self-employed individuals utilizing such buying and selling portals. Reporting obligations only extend to those who meet the following criteria:
- Residency in the EU.
- Earnings exceeding 2,000 euros throughout the year from sales.
If you meet these criteria as a self-employed individual, the platform must provide the identity of the sellers and all necessary information to be submitted by the end of January 2024.
The Tax Agency emphasizes that the objective is not about control but rather facilitating data collection to prevent tax evasion.
Navigating the Landscape of Second-Hand Sales Reporting
In summary, the implementation of DAC7 and its implications for second-hand sales platforms like Wallapop signal a heightened level of oversight by tax authorities. While aimed at curbing tax fraud, these regulations underscore the importance of compliance for self-employed individuals engaged in online selling activities. By understanding and adhering to reporting requirements, sellers can ensure transparency and avoid potential penalties.