Do influencers have to pay taxes?

Yes! There are several ways that an influencer's income can be taxed, and this all depends on the way the influencer has set up their business.

Limited company

An influencer could have turned their hobby into a limited company. This means any income they generate through their "influencing" will be treated as business income.

Like any other business, they will then have to pay corporation tax.

Having a limited company set up has a lot of benefits. The biggest one is the tax situation. Limited companies allow for a lot of different ways of tax planning via salaries and dividends.

Another tax benefit for a limited company is that any expenses an influencer has that relates to their business is used to reduce their tax.

This is because tax isn't calculated on gross income, but on income after expenses.

Another benefit is that any personal assets that the influencer has won't be at risk. The business is liable for all debts incurred.

Sole trader

Influencers can also work as a sole trader.

This is less hassle to set up, and has less paper work. There is more privacy, and taxes are simplified since the income will be added to their personal tax assessment.

Usually this is what influencers do when their income generated from social media work is relatively small.

Overall it's up to the influencer to decide which way of working aligns more with them as a person.

Panicking about influencer tax?

If you are an influencer who is now panicking about having to pay tax, don't worry! I can help. I have a handy article here that will help you get all your finances organised.

Feel like you want to set up your influencer business as a limited company? I can help with this too! I'm a virtual assistant who specialises in assisting influencers with their admin work, including figuring out all the above. Shoot me a message and we can have a chat!