Do influencers have to pay tax on gifts?
In recent years, the profession of influencer has increasingly developed from a hobby for individuals to a lucrative activity for a large number of people.
Money can be earned on the social media channels Instagram, TikTok, Snapchat, YouTube and Facebook with product reviews, sponsored posts or by participating in events.
As soon as influencers carry out a commercial activity independently and sustainably to generate income, they are entrepreneurs. Whether and which taxes they have to pay depends on the individual tax laws. Of particular relevance is the obligation to pay income tax, trade tax and value-added tax.
Profits from activities as an influencer generally trigger the following taxes:
With regard to income tax, an annual basic allowance of 10,908 euros applies (as of 2023; the basic allowance also refers to income from other activities, e.g. as an employee); if the income is higher, income tax must be paid.
Trade tax is payable on profits in excess of 24,500 euros.
There is an obligation to pay sales tax if the turnover in the previous year was more than 22,000 euros, otherwise the small business regulation applies.
However, the tax relevance of the activity as an influencer is often misjudged. This is particularly the case because those affected are often unaware of the tax significance of their actions.
Uncertainties exist above all if the influencer does not receive any monetary amount for their activity. This raises the question of whether and how free trips, hotel stays, donated products or invitations to events are taxable.
In principle, the goods/services received represent income in the form of non-cash benefits, which are taxable under income tax or sales and trade tax.
The value of the goods must generally be recognized as operating income.
If the Influencer* uses the goods exclusively for business purposes, he/she may claim business expenses in the amount of the value of the goods/services received free of charge (either immediate deduction for low-value assets or depreciation over the useful life).
If, on the other hand, he/she uses the goods/services purely for private purposes, they must be taxed as withdrawals increasing profits.
The following exceptions apply:
- If the value of an item given as a gift does not exceed 10 euros, it constitutes a so-called scatter article and is therefore not taxable
- Articles that are only received for test purposes and subsequently returned do not have to be taxed
- The donor (manufacturer of a product) can tax the product at a flat rate of 30 percent according to § 37b EStG if the value of the gift does not exceed 10,000 euros
