Tax On Social Media Earnings

Increasingly more and more people are turning to YouTube and other social media platforms to supplement their existing income, or to start a new career. There are many considerations you need to make when moving into this field, such as what type of content will I create, or how do I increase my number of followers.

YouTube, Facebook, Instagram, Tiktok, and X social media logos

One major consideration, which often falls by the wayside, is how do I declare and pay tax on any income I receive; social media influencer tax.


Income may be derived from a number of different sources such as:

  • Selling merchandise
  • Streaming donations
  • Channel memberships
  • Brand sponsorship

to name but a few.


Each of the above income streams is subject to Income Tax and, if you earn above £1,000 from one or more of the above, you will need to register for Self Assessment and declare the income to HMRC in addition to any other income you may receive, such as PAYE income from your paid employment.


Claiming Expenses as an Influencer

Your YouTube or influencer activities will be classed as self-employment; however, that does mean that you will be able to claim ongoing business expenses incurred to carry on that self-employment. This could be a proportion of your internet costs if broadcasting from your home, and any subscription costs you may have to pay to YouTube or other social media channels to broadcast your content.


Registering for VAT

If you’re lucky enough to start becoming successful and making substantial amounts of income from these activities, you will need to bear in mind that you may need to become VAT registered if your turnover exceeds the VAT registration threshold, which is currently £85,000. It can, however, be complicated to determine whether you need to register due to the nature of the services you are supplying.


Understanding The Tax Implications

While we encourage people to have fun undertaking these types of activities, please bear in mind that there are potential tax implications. Failure to declare income to HMRC at the correct time could result in a costly investigation, resulting in a hefty tax bill coupled with interest and penalties.


To get professional tax advice for your situation, fill out our contact us form and a member of our tax team will be in touch.