VAT treatment for OnlyFans content provider v2

VAT treatment for OnlyFans content provider v2

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[Editor’s note: The original post was removed after several AccountingWEB members had offered their opinions. Based on their summaries, we have attempted to summarise the outline issues raised and moderated some of the comments that remain so that the essence of the discussion can be preserved.]

The original question concerned the VAT treatment of payments to content creators via the OnlyFans platform and whether the website owner needed to account for VAT on the entirety of the fees paid by individual subsribers.

The poster reportedly asserted that subscribers would pay the platform to access content individual creators supplied to the platform, and that the platform would pay them for that supply, less a fee for handling the transaction.

The position taken was that by acting as an agent for the creator, the platform would only need to account for VAT on the agent’s 20% commission, not the full subscription fee.

They also appear to have asked for clarification on the whether the VAT MOSS regime would apply to digital services of this kind.

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By Robert Ross
30th Aug 2019 23:14

Interesting discussion.

If I understand correctly, the creators upload digital content to a platform that then manages consumer access to, and payment for, that content.
There are many content creators uploading to the same platform and all of their content is available on the same website domain e.g. www.onlyfans.com/username
Consumers register an account with the website and add payment card details, then choose which creators content they want to view.
On receipt of payment from consumer, the platform automatically allows the consumer to view\download that digital content.
Avoiding the b2b\agency\webcam points for the moment, it would seem difficult to argue that the platform does not in fact:
/authorise the charge to the consumer
/authorise the delivery
/set the general terms and conditions of the sale

so the website\platform should:
/ treat the sales of third-party e-services as if they were its' own
/ declare any VAT that is due
Hence, the website should be charging VAT to the consumer.
As mentioned in other replies, Patreon and Etsy both charge VAT in very similar circumstances.
You mentioned HMRC gave a written reply which you could post. It would be interesting to see that.

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Replying to Robert Ross:
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By amateurexpert
13th Apr 2020 15:51

.

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Replying to amateurexpert:
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By Robert Ross
31st Aug 2019 20:30

Is is not more the case that those rules are specifically designed to make the issue of b2b supply irrelevant?
Certainly Patreon and Etsy both appear to believe so.

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By BonnieLockheart
26th Oct 2019 08:19

Hi there

Very interesting debate here and I agree the users are not being charged VAT to view the content, but also please note, the creators are not being charged VAT either. There are no VAT charges on the creators commission, OnlyFans ONLY take their 20% commission fee as admin Fee, so are onlyfans paying any VAT at all?

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By Robert Ross
01st Jul 2020 20:40

So, an update to this discussion! Just saw this article that Onlyfans have started charging VAT from today. As the VAT rules don't appear to have changed in the past few years , I imagine they've had an interesting discussion with HMRC about historic liabilities. As they now claim on their home page to have paid out $800m, that could be quite a big number. As the OP seems to have disappeared along with his question and comments, I imagine he didn't take the advice offered!
https://www.independent.co.uk/news/uk/home-news/onlyfans-subscription-va...

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Replying to Robert Ross:
RLI
By lionofludesch
02nd Jul 2020 09:42

Robert Ross wrote:

So, an update to this discussion! Just saw this article that Onlyfans have started charging VAT from today. As the VAT rules don't appear to have changed in the past few years , I imagine they've had an interesting discussion with HMRC about historic liabilities. As they now claim on their home page to have paid out $800m, that could be quite a big number. As the OP seems to have disappeared along with his question and comments, I imagine he didn't take the advice offered!
https://www.independent.co.uk/news/uk/home-news/onlyfans-subscription-va...

What was the question again ?

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Replying to lionofludesch:
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By Tax Dragon
02nd Jul 2020 09:57

lionofludesch wrote:

What was the question again ?

"So this 'edit' function.... annoying or what?"

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Replying to Tax Dragon:
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
07th Jul 2020 11:17

Thanks everyone for your comments on this thread and as someone who arrived late, I share your frustration about the disappearing comments.

I will PM amateur expert to warn them about hit and run posting in Any Answers.

In particular, however, I'd like to thank those of you who made a valiant effort to maintain your professional poise with someone who didn't seem to want to heed your advice (from what I've been able to discern).

Meanwhile, we have escalated the issue of limiting the time in which you can edit posts. Have not doubt that I'll be back when I get an idea when that proposal might get acted on.

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By Alexander Martin
06th Jul 2020 22:16

Hello all, I hope you can excuse this intrusion into your forum. My name is Alexander Martin, I'm a technology reporter for Sky News. Earlier today I reported that OnlyFans' tax affairs are now being reviewed by HMRC: https://news.sky.com/story/onlyfans-could-be-hit-with-bill-for-more-than...

Following my report someone familiar with this site kindly flagged this post to me, and I can see who the OP was from the replies - although of course they have since deleted their message.

There is more detail in the story, but interestingly OnlyFans claimed in its statement to me that the VAT move last week was due to a recent change in how HMRC interpreted European Union law. HMRC denied that there has been any new interpretation, and crucially the posts in this forum suggests that the OP suspected their tax arrangements weren't quite right more than six months ago.

If anyone has a copy of the original message, please may you contact me? Either via email ([email protected]) or mobile +44(0)7970376704 would be brilliant.

And again, I do apologise for this intrusion. I know I would feel frustrated if it happened on a forum I use. But I ask you to consider than in the 21st century this is how good journalism happens. It must be done openly and transparently, but because important conversations are taking place on forums then journalists need to be able to go there too if they're looking to understand a topic and if they're searching for facts. I hope you can help me inform the public and hold power, in whatever form, to account. I'm not doing this to harass accountants.

With my thanks,
Alexander

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Replying to Alexander Martin:
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
07th Jul 2020 10:46

Welcome to AccountingWEB, Alexander. You're welcome to post here and as the person in overall charge of the editorial policy on the site, I can assure you we don't mind the debates here feeding into wider news channels (as long as AccountingWEB is acknowledged as the source).

Our own editorial team does that regularly because we think our members do know what's happening on the front line of business and that their voices should be heard more widely.

I'm sorry, however, that the original poster deleted many of their comments. This is a quirk of the site that can be irritating. I will be contacting them to ask them to refrain from behaving like this in future, but it's possible they felt there may have been compromising information in what they posted.

By the way, you can try and make contact with them directly by clicking their name at the top of the post and sending them a direct message via AccountingWEB. Maybe they will be more forthcoming if they are able to provide information on a background basis.

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