HMRC Sets Out Digital Platform Reporting Penalties for Operators
HMRC factsheet CC/FS98 lists penalties of up to £5,000, £600 a day and £100 per seller for platform operators that miss reporting duties.
HMRC published factsheet CC/FS98 on October 16, 2026, setting out digital platform reporting penalties of up to £5,000 for a missed deadline, £600 a day if the failure continues and £100 for each seller wrongly reported.
The factsheet is guidance for platform operators, but its effects reach accountants. Operators that fail to report cleanly leave sellers, landlords and gig workers with incomplete or wrong figures on the statements HMRC also holds.
The UK rules implement the OECD model rules. They took effect on January 1, 2024, and the first reports, covering that calendar year, were due by January 31, 2025. Each later year’s report is due on the same date.
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The penalties themselves come from the Platform Operators (Due Diligence and Reporting Requirements) Regulations 2023. The factsheet restates them in plain language and adds HMRC’s own account of how it will decide amounts and what rights an operator has.
What the digital platform reporting penalties cover
HMRC groups the failures into three bands. The first covers missed obligations: filing the annual report, giving each reportable seller their information and answering a written information notice from HMRC.
Each carries a penalty of up to £5,000. A separate penalty can apply to each missed obligation, but only one per obligation.
If the obligation is still unmet 30 days after the first penalty, HMRC can charge up to £600 a day until the operator complies. Under the regulations, daily penalties follow an assessment notice for late reports, seller information and information requests.
The second band covers accuracy. An operator whose report is inaccurate or incomplete faces up to £100 for each reportable seller affected.
That applies only where the error was deliberate, resulted from a failure to take reasonable care, or was discovered later and the operator did not take reasonable steps to tell HMRC. An honest error that the operator reports promptly falls outside it.
The third band covers the groundwork. Failing to keep the required records carries up to £5,000 per reportable period with failures, and there is no daily penalty. Failing to tell HMRC that the business is a reporting or excluded platform operator carries up to £1,000.
Failing to follow the due diligence procedures costs up to £100 for each seller for which they were not applied. An operator with a weak internal controls register will find that the due diligence and record-keeping penalties are the ones most easily tested.
How the penalties fit the wider regime
The regulations cap overlap. No operator is liable under more than one of the record-keeping, due diligence and accuracy provisions for the same act or omission. An HMRC officer chooses the penalty it considers most appropriate.
The factsheet applies the same logic to a business that fails more than one of the three. It will generally receive a single penalty.
HMRC says it will weigh the behaviour behind an error, how quickly it was corrected, the operator’s cooperation, whether it disclosed the problem, how significant the error was and whether the operator supplied the information requested.
No penalty applies for late reports, seller information, information notices, record-keeping, notification or due diligence if the operator has a reasonable excuse. The regulations rule out two excuses: insufficient funds and reliance on another person.
The second exclusion matters for groups that outsource their reporting to a vendor or an affiliate. The legal duty stays with the operator.
The process is set by assessment. HMRC writes to the operator with the amount and how it was calculated. If the operator disagrees, it should say so promptly and point out anything HMRC may have missed.
If HMRC still considers the operator non-compliant, it issues a penalty assessment notice that explains how to appeal. The regulations give 30 days from the notice to appeal in writing. The tribunal can set the assessment aside, confirm it, reduce it to nil or increase it up to the permitted maximum.
Assessed penalties are due 30 days after the notice is issued. For the late-report, seller-information, information-notice, notification and record-keeping penalties, HMRC has 12 months from the date of liability to assess.
For due diligence and inaccurate reports, the 12 months run from when HMRC first became aware of the problem, with a six-year outer limit.
Rights and false information
The factsheet says HMRC will tell an operator when it is considering a penalty and confirm that it understands its rights under the European Convention on Human Rights.
These include the right to decline to answer questions put to decide a penalty, to choose how far to help HMRC, and to take advice from a professional adviser. They also include the right to appeal, to apply for funded legal assistance for certain appeals and to have the matter handled without unreasonable delay.
Deliberate falsehood is treated differently. HMRC says it may open a criminal investigation and prosecute where false information is given verbally, in writing or in a document.
The factsheet states that it is for guidance only and reflects HMRC’s position at the time of writing. The penalty maximums are set in law, so they change only by amending regulations.
What platform reporting means for accountants
Most accountants do not run platforms. Many act for people whose income the platforms report: sellers of goods, providers of personal services, landlords letting property and those renting out transport.
The £100 a seller penalty is the one to watch for these clients. It attaches to an individual’s record, and the record is what HMRC holds when it compares a return with platform data.
Operators must give each reportable seller their information by January 31 after the calendar year. That is the same date as the self assessment filing and payment deadline, which leaves little time to reconcile.
A practical routine starts with collecting each client’s platform statements by early January. Check the name, address and tax reference on each. Reconcile the income shown to the client’s own records and decide whether it falls within the trading or property allowances or needs to go on the return.
Where a statement is wrong, the client should raise it with the operator in writing. The operator carries the penalty risk for a deliberate or careless error, but the client carries the tax risk if the return is wrong. A written query also shows reasonable care.
Clients with several platforms, such as a landlord using a letting site and a seller using a marketplace, are the most likely to produce mismatches. Keeping digital copies of statements helps, and so does proper document management for the supporting file.
Income reported by platforms also feeds the quarterly reporting regime for the self-employed and landlords. Firms preparing clients for Making Tax Digital for Income Tax now have a second data source to match against bookkeeping records. The MTD for Income Tax pack covers the client-side checklists.
What comes next for platform operators
Platform operators face their next report, covering calendar year 2026, on January 31, 2027. That date also applies to the seller statements.
The factsheet points operators to HMRC’s separate GOV.UK guidance on registering as a platform operator and on reporting sellers to HMRC. It also refers readers to factsheet CC/FS9 on the Human Rights Act and penalties, which sets out the rights HMRC will cite.
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