What is social media tax
As an influencer, do I have to pay taxes?
Well-known influencers earn their living with posts on the various social platforms. There is no question that the income, just like other self-employed, has to be taxed. But what about small accounts? Do these still count as a hobby or do they have to be reported to the tax office? The Federal Ministry of Finance has published an FAQ on this question, which is intended to give influencers an initial overview of their tax liability.
Income tax, trade tax and sales tax
First of all, the question arises whether income tax, trade tax or sales tax have to be paid. Different requirements apply here. Income tax must be paid by anyone who regularly works as an influencer with the intention of making a profit. The intention is to have higher income than expenditure. If the income remains below an annual basic tax allowance of 9,408 euros (this includes income from all activities and also business gifts), no income tax return has to be submitted. In principle, the activity as an influencer is also subject to trade tax. Trade tax is payable if the trade income is higher than 24,500 euros.
Good news for all small business owners. Previously, if the sales taxable in the previous year did not exceed 17,500 euros, the small business regulation can apply. This turnover limit has now been increased to 22,000 euros. If the sales fall below this amount, no sales tax will be charged.
Do free products or gifts have to be taxed?
Many small accounts are only offered free products instead of payment. What many do not know: Free products or gifts also have to be taxed for income tax as well as sales tax. However, no general rule applies here. Because companies can, for example, take over the taxation for the products. Even gifts of very little value do not necessarily have to be considered. The Federal Ministry of Finance advises that everything be precisely documented. The ministry also specifically points out income from affiliate marketing. It can be assumed that many influencers have neglected income from these two categories more often in the past.
Those who fail to meet their tax obligations risk “in addition to the back payment of unpaid taxes, for example high interest payments, fines and in extreme cases even a prison sentence”. If you have any questions, you should seek tax advice. In addition, the responsible tax office could be of assistance. There is an overview of all tax types in the Ministry of Finance's FAQ.
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