Calling all content creators and influencers!

The rules around the trading allowance, and income and capital gains have not changed. However, there does seem to be a lot of confusion about when and how people need to pay tax on additional income or gains from selling items online or earning money through social media content. HMRC have come up with a new tool for what they refer to as people with “side hustles”. This new tool should help.

https://www.gov.uk/guidance/check-if-you-need-to-tell-hmrc-about-your-income-from-online-platforms

Will Drysdale, Senior Reporter at Business & Accountancy Daily, advises that from January 2025 HMRC will have new disclosure rules for online operators; from the new year, reporting of all sales by individuals to the tax authority will be mandatory for all online platform operators.

The rules will affect content creators and influencers earning income through social media and streaming channels such as YouTube and Twitch.

HMRC stated: ‘You may need to tell HMRC if you receive income through an online marketplace or social media, even if you do not need to pay tax on it. This could be whether it’s your main source of income or an additional source — sometimes called a side hustle.’

The HMRC tool is a questionnaire which starts by asking whether the individual received any additional income, whether it was for selling goods or services, renting out land or property, creating online content or any other form of earnings. However, if ‘anything else’ is selected, a message pops up stating that ‘this tool is for people who sold goods or services, or rented out property’.

If the tool decides that tax is payable, a green banner appears stating: ‘You need to tell HMRC about this income’. Links are then provided to register for, or complete a self assessment tax return.

Let us know if we can help you with this.