Do Social Media Influencers Pay Tax in the UK?
If you’re new to being a social media influencer or are planning on exploring how it works, you may be wondering whether you need to pay tax on any earnings. The short answer is yes, as tax has to be paid on any kind of earned income in the UK. Read on to find out more.
Tax on income for social media influencers
The tax obligations for influencers depend on the nature of their work, how they generate income, and their overall financial situation. Here are some things to bear in mind:
Income tax
Influencers are subject to income tax on the money they earn from their activities. This includes income from brand partnerships, sponsored content, affiliate marketing, and any other sources.
National Insurance Contributions (NICs)
Depending on their income level, influencers may also be required to pay National Insurance Contributions (NICs). NICs contribute to social security benefits and the State Pension.
Registration with HMRC
Influencers who are self-employed or have their own business must register with Her Majesty's Revenue and Customs (HMRC). This is necessary for tax purposes, and failure to register can result in penalties.
Self-assessment tax return
Self-employed influencers typically need to complete a Self-Assessment tax return each year. This includes reporting their income and expenses to calculate the tax owed.
Remember: If you're a social media influencer in the UK, you're required to pay tax on your income just like any other individual. This includes income from sponsored posts, brand collaborations, and other forms of advertising that you're paid to run on your channels or website.
Other things to bear in mind
Expenses
As an influencer, you can deduct certain legitimate business expenses from your income when calculating your taxable profit. This might include expenses related to equipment, marketing, travel, and any other costs directly associated with your work.
Value Added Tax (VAT)
If your taxable turnover exceeds the VAT registration threshold (£85,000 as of 2023), you may need to register for VAT and charge VAT on your services. However, this depends on your specific circumstances, as not all influencers are required to register for VAT. Get in touch for tailored advice and guidance.
IR35 Rules
The IR35 rules apply to individuals working through an intermediary, such as a personal service company. Influencers need to assess their working arrangements to determine whether IR35 applies, as this can affect their tax obligations. We can help with this, so make sure to use the contact form below to find out more.
Tax advice for social media influencers
As with any other kind of self-employed individuals, it's important for influencers to keep accurate records of their income and expenses, as well as to stay informed about changes in tax laws and regulations.
Seeking the advice of a tax professional or accountant can be beneficial to ensure compliance with tax obligations and optimise your financial management. Why not get in touch with TreyBridge Accountants to see how we can support your growth journey and help you to expand your business?
Contact us today to schedule a consultation
If you're looking to improve and grow your business in 2024, it's time to have a chat with our team of accountants, payroll managers, tax planning specialists, credit control agents and dedicated business advisors. To get started, call our Northern office on 01482 235575, our London office on 0207 885 0605, or fill in the contact form below.
Tagged as: Self-employment, Tax
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