What is the HMRC Digital Platform regulation?
HMRC Digital Platform (also referred to as “DAC7”) is a directive implemented by the UK’s HMRC (Her Majesty’s Revenue and Customs) to enhance tax transparency and compliance within the digital platform economy. This regulation mandates digital platforms to report the income earned by sellers using their services.
The primary goal is to prevent tax evasion by ensuring that all income generated through digital platforms is accurately reported and taxed accordingly. This includes income from activities such as selling goods, renting properties, or providing services. The directive aims to create a level playing field, ensuring that digital transactions are subject to the same tax rules as traditional business activities.
By enforcing DAC7, HMRC seeks to close the tax gap and ensure fair taxation in the growing digital economy. In our case, our agencies will be the ones who have to report on the income they have paid to their owners. SuperControl will provide the tools to run an XML report for your annual report submission which an agency can upload to their HMRC gateway.
Additionally, we will provide a user interface to collect the necessary owner data for successful reporting
1. When are these changes available on my account?
We’re excited to announce that we’re aiming for a release date of October 7th, 2024 for Phase 1 (Data collection). The additional functionality to add ‘additional sellers’ per owner will follow shortly after as we’re currently working on it. Our goal is to release the main part of the project as soon as possible so you can start collecting data at the earliest opportunity.
2. If I am a sole trader, do I have to collect due diligence data?
No, you are not required to collect due diligence data at this time (if you are an agency operating as a sole trader). This requirement may change in the future, but for now, it is not necessary.
3. How will I be able to submit my January report submission?
We will provide tools to download an XML file, which you can then upload to your HMRC gateway. This feature is not yet released, but we aim to have it ready before the January report submissions are required.
4. What if I want to collect further due diligence data that is not provided in SuperControl?
We only provide the fields required for a successful report submission. If you wish to collect additional details, you will need to do so outside of SuperControl.
5. Do I have to submit data for ALL of my owners in January 2025?
No, for your first year’s report, you only need to submit data for owners added from January 2024 onwards. This should significantly reduce the time needed to collect due diligence data before January 2025. In subsequent years, data collection will be required for all owners.
6. What data is sent to HMRC for my owners?
HMRC requires all the necessary “seller” data set up within SuperControl. For the annual report submission in January 2025, this will include all due diligence data and all payments made to each owner for the previous year. You will also have the ability to upload correction files throughout the year if there are any changes to owner payments.
7. Can I pass the responsibility onto my owners to enter their data?
Yes, we have built in the ability for owners to enter the information within the Owner Login. See page 4 and 5 of this document on how you can do this
8. In which situations would a seller’s DAC7 category be marked as “Not required for DAC7”?
If you have an owner that is outside the UK and Europe, or if you use owners for itemising out fee's e.g. Booking fees.
9. How can I verify the data is correct?
There is some third party software you can use such as "Yoti" who will help to verify information. Once you have verified the information you can tick the "Due diligence is correct and verified" tick box in Agency > Seller Validation (DAC7).
First you need to make sure your company details are complete.
Go to Admin > General details.
Make sure, the contact details etc. are all up-to-date.
In the section DAC7 settings further down the page, ddd the information for the Legal company name and Platform ID (coming soon - this will be provided during your HMRC registration for Digital Platforms).
If you would like to be notified by email when an owner updates any DAC7 information in their owner login, enter the email address in the field Emails to notify after owner changes DAC7 seller information.
You can enter more than one email address, if needed.
You can decide on individual settings as to what access each user should have for the DAC7 data.
Please note:
Only the Default user can change the DAC7 access priviledges.
- Go to Admin > Login users > Edit to the right of the user
- Scroll to the right hand edge of the window and select the access level required from the drop-down menu.
Select the appropriate access level.
No access to DAC7
This will not allow user to view masked data or run the report. They will still be able to view all non-hidden data. User cannot edit or add personal data.
Access to DAC7 personal data
This will allow user to unmask hidden data fields but not run the report. User can edit or add personal data.
Access to downloading DAC7 report
This will allow user to unmask hidden data fields and also to run the final report. Users can edit or add personal data
- Click Save.
Please be aware that for your first year’s report submission in January 2025, you only need to gather data for owners created in 2024. This will greatly reduce the amount of data you need to collect for your initial report
You will find a new section called Seller information under Agency >Edit owner as well as under Agency > Add owner.
We have to label sellers and owners differently as the person who owns the property may be different from the seller of the property.
Owner: The property belongs legally to this person / these persons
Seller: This is the person who is assigned to receiving the payments generated by the property.
Example:
Mr Smith is owning the property.
Mrs Miller is receiving the monies.
You would need to collect the data for Mrs Miller as the seller.
In most cases the owners details may also be the sellers details. As shown in Agency > Edit owners. The fields will differ slightly whether they are an Individual or a Business.
All of the fields are required for you to be able to successfully send the report to HMRC.
In which situations would a seller’s DAC7 category be marked as “Not required for DAC7”?
If you have an owner that is outside the UK and Europe, or if you use owners for itemising out fee's e.g. Booking fees.
Data collection for multiple sellers
If you have multiple sellers per owner record, you need to enter these sellers individually.
Example:
The property is owned by Mr and Mrs Smith. Both are receiving money for the property.
- To do this go to Agency > Edit owners > click Edit [to the right of relevant owner] > section Seller information.
- Enter the data of the first seller.
- Click Add additional seller and add the information for the second seller.
The owner has also the option to enter more than one seller via their owner login.
Keeping track on who still requires data entry/or any data that needs verified
A new report will be found under Agency > Seller validation (DAC7).
This report will allow you to keep track of owners still requiring data to be entered.
You can easily enter the missing data into this new report style bu clicking onto the pencil tool to the right of the owner.
You can allow owners to complete the information via the owner login as well.
- Go to Agency > Edit owner > Click the owner ID.
- Scroll to the section Owners' login details.
- Tick the box in front of Owner can add DAC7 requirements.
Tip:
If you haven’t set up the owner login, please see this help centre article for further details.
The owner login will have a new option under the Your details menu, called DAC7 requirements.
This option will open a page allowing the owner to add their DAC7 required data.
Please note:
We will be encrypting specific fields that are classed as personal sensitive data, so once DOB, Country/City of birth is entered, it will show as seen in the screenshot below.
You can easily email all your owners, who have missing DAC7 data. Thus prompting them to enter any missing information.
This will alleviate your workload as your owners will be providing data directly.
- Go to Agency > Email owners.
- Compose your email text in the Email section at the top.
- Scroll to the bottom of the page.
- Tick the option Only email owners with missing DAC7 data.
Tip:
If you want to only email a segment of your owners, for example group your 2024 newly added owners into one property group.
Then use the section Send to Property Groups to tick a particular property group.
This in combination with the ticked box to only contact owners with missing DAC7 information will allow you to email a very specific number of owners.
Please note:
If a property already belongs to be property group, it can not be added to a second one.
Automatic email notification once data is changed via Owner Login
When an owner updates their DAC7 data through their login, you will receive an email notification.
This alert will inform you that there is new data that needs to be reviewed and verified. You can choose who should get the email notification via Admin > General details:
All seller information MUST be verified to make sure that the data is correct.
It is your responsibility to check the data is correct.
Within Agency > Edit owners > Edit > section Seller information and in the report found under Agency > Seller Validation > click the pencil to right of seller entry, you have the option to mark a seller's data as having been checked and verified;
Please note:
Should any information be added, amended or deleted after the data was verified, the tick box will become automatically unticked again.
As part of the DAC7 requirements, agencies must enter the property type for their properties.
We have created a new Property type list that can be accessed via Properties > Add and Properties > Edit. It is populated with a set list of Property types that is supported.
This list can not be amended.
The existing property types have been renamed Custom Property types. These can be managed via Properties > Custom property types.
For properties outside of the UK, a Land registration number may be required for DAC7.
This will only show if the property is outside of the UK (EU).
We are progressing with this project in two phases. The first phase, which involves data collection, will be released on 7th October 2024 (as detailed above).
The second phase will enable you to download the report. This will be completed in time for the HMRC submission deadline, and we are actively working on it now.
By January, you will be able to download an XML file from SuperControl to upload to your HMRC Government Gateway. More details will be provided once it’s ready.