UK tax authority nudges net 'influencers': You may owe us for those OnlyFans feet pics Those pencil-necked desk jockeys at His Majesty's Revenue and Customs (HMRC) are about to give the UK's legions of online "content creators" and "influencers" a rude awakening by reminding them they could owe tax on their income. Though many people "create content" for simple enjoyment rather than a money-making side hustle, …
At least if HMRC were in the general habit of designing their letterheads and business cards carefully to avoid any acronym expansion (I don't know whether they are or not), they might not need to incur the expense of reprinting them, unlike those (no longer) QCs, who have no such luck…!
(Maybe someone should propose that English should perhaps more closely follow the Germanic/Nordic forms and use something like "Kingin" (or maybe "Kvínn") as the title for a female monarch, or, given the family ancestry, maybe "Königin" wouldn't be all that inappropriate… Or there's perhaps a more 'revolutionary' solution to that linguistic problem… ;-) )
They always used HM, inherited from HM Customs and Excise at the time of the 1995 merger that created HMRC. There was no way even back then that the authorities would be stupid enough to expand that abbreviation knowing that it was liable to become defunct at any second, Liz II was already pushing 80.
I actually said something similar about kvinna/kona etc. at the time it happened, as I was fairly into the Icelandic sagas back then and always into etymology. But I like your revolutionary idea better. :)
"Or there's perhaps a more 'revolutionary' solution to that linguistic problem…"
Oui citoyen.
QC - some AU states use SC instead - Senior Counsel apparently.
I think OE had cyning and cwen - perhaps the linguists can construct the neuter case from either. Both start with C which might be a bit of a problem for QC/KCs becoming CCs :)
about 0.7% of the UK population is some flavour of trans. Most of us are binary trans and use the binary she/her he/him pronouns.
Of the NBs (Non-binary trans folk, pronounced enbies), many do use at least some binary pronouns, e.g. she/they, he/they etc or are happy with all pronouns.
I don't have numbers but while enbies who actively don't use binary pronouns or use neo pronouns definitely exist and their identity should be respected, the statistical probability of one of them becoming the monarch is vanishingly small. That's also before you account for the fact that an organisation as old-fashioned as the Royal family is probably not going to be massively accepting of anybody in the succession being any flavour of transgender.
Plus...
"UK influencers and content creators earned on average $146.86 and $113.19 per hour respectively – the highest in the world."
This is about the UK. First part of the article is in US$ only and then halfway down it is £ to $
Can El Reg stop this please? Go back to UK units and then convert for the US audience?
Disgusted of Tunbridge Wells (give or take 32 miles)
""UK influencers and content creators earned on average $146.86 and $113.19 per hour respectively – the highest in the world."
This is about the UK. First part of the article is in US$ only and then halfway down it is £ to $
Can El Reg stop this please? Go back to UK units and then convert for the US audience?"
The US is not the only place that calls their currency dollars. Dollars are also used in Canada, Australia and New Zealand. It would be nice if the country being converted to was indicated, for example US$, C$, A$, or NZ$.
Plus the way it reads "some 2.8 million UK influencers and content creators earned on average $146.86 and $113.19 per hour respectively" - That's a lot of money and people!
It prompted me to scratch my head and do some Radio4 More of Less style sleuthing.
The report actually says the base of people that Adobe surveyed who averaged $146 and $113 were (maybe) 259, not 2.8 million, which seems way more realistic.
"Base: Creators who monetize via social media US (n=196), UK (n=172)
Base: Influencers US (n=79), UK (n=87),"
That was along the lines of my reaction - 2.8 million people in the UK is almost 5% of the total population. Bearing in mind that their online presence is 24/7, that could earnings of around £2.5T - two years tax would wipe out the UK national debt. But, as any loyal MoL listener knows, that's just not believable. Even cutting the earning time to the "normal" working day is still unbelievable at 25% of UK GDP.
I'll not go into a rant about quoting UK earnings in unspecified $...
What if they are influencing with their content or the content to advertise shoes has been created?
Educational content can be an influence to whatever they are showing you how to learn and influencers can't just advertise, they need content to do it which they have to create.
As far as I know, the term "influencer" was created by marketing people to identify elements of their marketing strategy. So while logically it should refer to "one who influences", which is basically anybody who speaks, in practice it refers to a class of marketing spokespeople who are semi-independent and communicate exclusively through social media or similar platforms.
An influencer is no different than the huckster spouting all of the benefits of some cheap plastic thing on late night infomercials. It could be a celebraty that's famous for being famous shilling for some sportswear company/Crypto exchange/tropical resort.
A content creator includes influencers but they are usually somebody that has an online presence with some sort of focus. AVE, Big Clive, EEVBlog and Thunderf00t create content but do very little to push products they are being paid to endorse. Thunderf00t is so controversial that companies might give him money to not mention them. (We love ya, Phil).
"HMRC require you to pay a third-party so you can use their software"
Futhermore, although HMRC provide specifications for software developers, as I found out when working on an online accounting package, even if you follow the spec to the letter HMRC don't warrant that the calculations will turn out correct and will pursue the taxed individual for errors.
"... if you pay VAT - which these influencers should be..."
I wonder how that's supposed to work??? If eg Google pay someone a few pence per view of their video, and it adds up to say £100 - shouldn't Google be adding £18 in VAT, which the influencer is then forwarding to HMRC?? Or (as I think more likely) is Google just washing its hands of the complications in it's fine print and stating that the £100 includes VAT?
Over here, the IRS requires you to use a third party to file ordinary income taxes electronically. Who do their best to monetize their 'customers' by directing them to non-free products. (they are supposed to offer a free option for low income filers)
It's costing me $40 USD to file this year, but I'm getting back $2 so it's all worth it.
"Over here, the IRS requires you to use a third party to file ordinary income taxes electronically. "
Why make it easy on them? I do all of my taxes on the computer and then send in paper forms. This way I know all of the sums are correct and I've received hints about the forms I need to file but I've also given the tax man a disincentive to manually go through everything and check my math/number of forms. I expect they look at the main figures to determine if spending thousands to have a close look is worth the effort to find out if I've cheated on $100 (although the fines can be substantial). I'll keep doing this until it's mandatory that taxes are filed electronically and The Man has to provide services to those without the means to buy a computer and pay for the service.
Why make it easy on them? I do all of my taxes on the computer and then send in paper forms.
Then I have to print them. (15-20 pages) Get a special envelope. Take it to the post office and get it weighed. And a couple more $ for postage. TBH, I don't know if Fed has fillable calculating forms. So I give up on the tax software completely (which includes Fed electronic filing) and do it all manually?
Note that I do state returns manually, because once the Federal is done State is pretty straight forward. Fillable calculating forms. Then it's the print 20 pages, 8x11 envelope, trip to the post office. But that's cheaper than the $20 they want for electronic state filing with your Federal. And for my state, they really don't care which way you file because they incorporate the form's data in a pdf417 2d barcode so it's a simple scan for them.
they don't provide a service, but the rest of the system does, in exchange for the minor contribution required from us all. In exchange they provide our world-class health system, famous social services, free-for-all, top-class education, rail transport that's the envy of 1st world and many other great benefits that you enjoy every. single. day. Also, the system gives us VAT which is a great benefit to us all, brexit or brexin. Where else would you get a better deal?!
*Sigh*
- You are free to "refuse to deal with HMRC" - you can remove yourself from their jurisdiction!
Of course, this means that you're no longer elegible for services & protections afforded the tax payers - like courts, the NHS, schooling for the kids etc.
Best of luck with that ...
Some might think that there has, over several decades, been a growing disconnect between what you pay in tax and what you actually get back. After they've driven back along the pot-holed road and spent an hour on the phone to the GP or some NHS department to be told that there are no appointments, phone back next week. And possibly after they've reported that their garage was broken into (just to get the case number for the insurance - nobody actually expects the police to do anything about this sort of thing now).
Then it's the most overcharged service in history, as it clearly doesn't take hundreds of billions every year to run it. But we know that only a fraction of taxation goes on running HMRC. And as you say, that's fine. But let's cut the crap of calling us customers. What we are has a name: taxpayers.
"Of course, this means that you're no longer elegible for services & protections afforded the tax payers - like courts, the NHS, schooling for the kids etc."
Those that have emigrated to the country informally seem to have little problem accessing those services.
If you earn £10,000 from Onlyfans subscriptions or whatever, and that is your only income from the year, you have to fill in a tax return, but your tax bill will be £0, because it is covered by your personal allowance.
That £10,000 is after deducting expenses. The £1,000 trading allowance is before deducting expenses, including the commission that Onlyfans or whoever deducts before sending the money to you. If you go above £1,000 you can either deduct £1,000 as expenses or your actual expenses, depending on what works best for you.
well, strictly speaking, you can still pay the voluntary n.i. contribution even below that threshold. Not that you'd be able to survive on 200 - 400 quid a month if you live long enough to retire. And they'd probably tax it again before you get that 400 quid anyway. It's a great, great system. Double and triple taxation, etc.
Whilst things seem clear cut, remember how HMRC and others have gone after ebay and Amazon traders. Plus there is a different and much lower threshold if you export to the EU...
https://www.rsmuk.com/ideas-and-insights/tax-voice-june-2021/new-eu-vat-rules-for-e-commerce-from-1-july-2021.
Given the current cash-strapped times, wouldn't be surprised if HMRC decide to lower the UK domestic VAT registration threshold...
I suspect OnlyFans charges VAT on the OnlyFans slice of the subscription and for payments processing.
This all reminds me of when I had to fill in a tax return every year. Remember that old advert "tax doesn't have to be taxing"? No it doesn't so why do you make it so it is? I'm sure half the unpaid tax from individuals is coming from people who look at the form and just say, like I used to, "If I don't understand the question the answer must be No". So I answered No to everything.
Amazon and Ebay have different rules because they are selling physical goods, not services or electronic goods.
Amazon do also sell electronic goods (mp3 files, Kindle books, streaming services, etc), and the rules there are not different.
OnlyFans is required to charge VAT on the whole subscription. If the subscription is £12. They will take £2 off for VAT and pay that to HMRC, then deduct their commission from what's left, and pay the balance to the creator / influencer.
If you are selling to an EU county, or indeed any other country, then you have to comply with their tax rules.
If it is an OnlyFans creator based in the UK with EU subscribers, then OnlyFans will deduct the appropriate VAT amount in each EU country.
Good old HMRC - Let's make things even more complicated... and let's tax everyone and their dog even if they just sell something they've already been taxed on (I refer specifically to those flogging some stuff on FleaBay that they don't want anymore)... No wonder everyone and their dog now use Facebook Marketplace (because eBay actually report stuff to HMRC).
That said, the relationship between personal tax allowance and trading (as a side hustle) is not particularly made clear to people by the platforms either, it should at the very least be part of the ongoing comms process for those who earn most of their money off those, erm, visual platforms.
If you are selling stuff you don't want any more..
That's one I've sometimes wondered about. So if an 'influencer' gets free stuff, isn't that a benefit in kind, and potentially taxable? I've heard about this one with some sales incentives where staff are given trips to luxury resorts for special company meetings for top performers. Sometimes, HMRC doesn't believe that. Presumably it's safer if the side-hustle is run as a business, but there wouldl still seem to be challenges around getting caught for co-mingling business and personal benefits that could attract tax liabilities. So maybe someone gets sponsored by OnlyFresh and gets sent free meals given allowable food expenses gets complicated in most tax jurisdictions. Then if the ad-read includes feeding your family the delicious, healthy grub, there'd probably be some personal liability.
I assume much of this has been figured out given celeb endorsements in exchange for free stuff or cash has been a thing for years, but I'm guessing many online 'celebs' aren't aware of the rules.
>So if an 'influencer' gets free stuff, isn't that a benefit in kind, and potentially taxable?
Welcome to the grey area of taxation where the tax will tend to review after the event to determine whether something should have been taxed. A lot hinges on "primary purpose" and the way in which you gained financially.
>someone gets sponsored by OnlyFresh...
Assuming the sponsorship is to say produce YouTube videos showing how to prepare OnlyFresh meals; once the meal has been produced, the food is waste... Hence you could invite friends round and share, however, if you were more commercial with respect to the consumption of the waste food, the tax man would be interested in your gains from this activity.
Unfortunately, crypto stacking income is "trading income" and holding on to the cryptocurrency rather than disposing of it instantly, and having it drop in value is a negative "Capital Gain". And I don't think you can offset capital gains (losses) against income. The HMRC rules on crypto are not entirely thought out - and possibly challengeable. It's on my list of things to to discuss my accountant, if the sum involved ever justifies paying an accountant.
I have to do "real time" reporting to HMRC of salaries for my company. Why not make it a legal requirement for the platforms to report to HMRC the amount of money they pay their influencers? HMRC could add it in to the tax system and it would make it less likely that someone might forget to add the income to their tax return.
"Why not make platform to actually sign employment contract with the influencer?"
The platform isn't imposing any sort of editorial control and just hosts content. If that content generates enough traffic, they'll share in any ad revenue. To get ad revenue, your channel needs to be bland and rather LCD while pandering to the more primal urges. If you are controversial, chances are good your video will be demonetized and the platform will keep all of the revenue.
There doesn't seem to be enough of a collaboration for a creator to be deemed an employee anymore than a billboard company can call advertisers that use them employees that create content for their billboards. At least in the US, there is a test to determine an employee from an independent contractor. Most of it hinges on who directs the work. In the case of people that post videos, the connection is even more separated. If the platform approached somebody and asked them to create a certain type of content of a specified length and publishing frequency, the relationship could be considered employee/employer if the creator isn't a production company that does that sort of work in their normal course of business for a multitude of clients.
That's incorrect. OnlyFans is UK based.
Then corporation doing business in the UK (as in de facto employing influencers) has to create UK establishment and so the workers could be engaged in employment contract with such local post.
If the platform refuses to do so, it can be simply banned from the country.
Extraterritoriality is manageable. Some countries/cities won't let AirBnB advertise rentals unless the owner has previously obtained an authorization number, and AirBnB will have to report how many nights have been booked in the last period for income tax purposes. They can also be made to collect the visitor tax where applicable.
Not that I've looked into this too deeply, but the majority of high earning influencers make their money not from the site through which their audience sees them, but from the advertisers whose products they hock.
So the platform reporting the money they pay influencers would only be one part, and a small part at that, of the big picture...
Given that they are performing personal service, that work likely would be caught by IR35 rules. This means these expenses would have to be reimbursed by the deemed employer, but there is no requirement for deemed employer to do so - for instance the deemed employer may claim that these tools are not used solely for the content to be produced on their platform.
So I have doubts these costs can be claimed in any way unless the workers become proper employees.
..for instance the deemed employer may claim that these tools are not used solely for the content to be produced on their platform.
I'm guessing that one could be easier to be deemed outside IR35, unless the person is solely 'working' for OnlyFlans. Many online 'celebs' seem to be non-exclusive, so drop work on YT, OF, Instagrot, TicToc etc. So based on output across multiple platforms, it'd seem like they're not disguised employees.
But I guess there's potential for more fun. So celeb works for their company and expenses a pile of implants. Company goes bust, administrator or liquidator wants the company's assets back. They will have their pound of flesh?
There is a bookkeeping difference between 'expense' and 'capital investment' and asset...
Many years back, one employer tightened their expense policy; someone had taken exception to us going out and buying an A0 plotter on expenses (working aboard, we needed it now, the local IT wholesaler had one in stock and would taxi it across town to us and the client would reimburse via expenses)...
Where IR35 is concerned it doesn't matter if person is working for multiple platforms. Each contract is looked at individually and in isolation. That's a common misunderstanding of the new rules.
Just like you can be employed by many businesses. It's also possible to have contracts in and out of scope of IR35 running concurrently.
Why not make it a legal requirement for the platforms to report to HMRC the amount of money they pay their influencers?
On many of the platforms, the bulk of the influencer's income isn't coming from the platform. For example, it used to be YouTube ad revenue paid well. But then Google tweaked the program (several times) and now most of their incomes come from non-Google sources. Sponsorships, branded merchandise, Patreon, etc.
While OnlyFans could report income, OF is more of an online store than a employer/employee relationship. They have limited control over what you post. Since there are production costs for pictures and videos, be sure to keep track of your cost of goods sold.
-- this post sponsored by Arthritic Greens.
We've been down this road before on El Reg with the IR35 nonsense. HMRC is well aware it doesn't have the legal muscle to enter in to protracted battles with Amazon et al so goes after people that it can win battles with. Unfortunately for them they picked on more than a few broadcasters who do have the money to pay for expensive lawyers and accountants who keep proper records, and so have won their cases.
I've been shooting photos and selling them through my side biz for a few years now, despite the biz turnover being less than a few expensive meals, the biz is registered, has proper documentation, a full tax return is filed every year by my wife with me as supplier of created materials, she pays the biz NI, etc. If my wife and I have to jump through hoops with HMRC just for a few hundred snaps I sell every years, then all those young ladies shaking their "money makers" for sad lonely men can also declare yearly filing with HRMC too!
If you don't have the tax knowledge my dears, then I suggest you invest some of your money in an accountant then you really will learn what it's like to be bent over and....
>a full tax return is filed every year by my wife with me as supplier of created materials, she pays the biz NI, etc.
Not clear whether you are employed by your wife or whether you are independently self-employed.
Either way, a nice little hobby that also pays, in that it probably accrues some beneficial tax losses...
If you don't have the tax knowledge my dears, then I suggest you invest some of your money in an accountant then you really will learn what it's like to be bent over and...
.. reminded that even if the accountant gives you bad advice and lands you with a large tax bill, they aren't liable. Or if they are, you'd need to also invest in lawyers to argue that they were. I did much the same thing and set up a company to handle that and avoid the potential hassle of splitting our/declaring income on my tax return. At least with small business exemptions, the accounting is simpler and cleaner. Main issue that confused me were the potential benefit-in-kind/P11D implications. So camera gear expensed through the company was for company use only, and if I bought a van or station wagon, it'd be covered under traditional company car rules. Then it was figuring out IP issues, which was done on a free-lance-ish way with both the company and myself retaining rights to any images, and my money came via royalties and licence fees.
Then came IR35. Yey!
It's a bit frustrating that the goverment wants to encourage small businesses, and force them to be legit, yet our tax codes are horribly complicated. So it's easy to make expensive mistakes, despite the best intentions. Plus the use of random extortion generators if HMRC loses a return. So at one point I was sent a demand for around £750k, and my company wasn't Getty Images. Then the burden of proof is shifted so I had to prove the company filed ahead of time, and the tax demanded was nothing close to revenue or expected revenue for any comparable business.
Correction required: "unpaid tax" should read "unpaid tax from poor people". HMRC will take hundreds or thousands from individuals, but are more than happy to let rich corporations off the hook for billions. Vodafone's sweetheart deal relieved them of so much unpaid tax burden that had they been made to pay in full it would by itself have covered the entire first round of austerity cuts to local authorities. And that's just one company.
A content creator is somebody who - as the name suggests - creates "content" in whatever form a particular platform is based on. So for Instagram it might be photos and/or short videos, for TikTok it's entirely videos etc. There are even content creators for the likes of LinkedIn which are generally written articles covering a particular subject. The goal of this content is always to promote a particular product/service/thing but to do so in a way that gives a human element to it. So if it's a particular item of, say, gym gear it comes across as an honest*** review from a real person, as opposed to the company trying to sell it. It essentially humanises what was previously something being sold from Big Faceless Corporation(TM). But they like this because it generates sales. The content creator likes it because they get commission. Win-win.
An influencer, on the other hand, is a level up from a content creator. In their case they have amassed a following to the extent where whatever they're trying to promote effectively sells itself based on who they are...or rather perceived to be. However - the principle thing they are trying to sell is themselves - to gain more of a following and therefore rapidly increase the size of that vicious circle. They like this because Big Faceless Corporation(TM) will give them stuff for free, on the basis a lot of other people will be influenced to pay for it. Win-win for the influencer and company. Not so much for Joe Citizen.
Both are there to make money (for themselves). This is income and therefore should be taxed appropriately.
*** For a given definiton of "honest". On some platforms like Instagram you have to make clear if you're advertising something. But it's not like anyone cares because it involves reading.
I'd take issue with:
The goal of this content is always to promote a particular product/service/thing
That's just an advert. Quite a lot (most?) 'content creators' aren't making adverts, they're making entertainment of some form or another, and then being paid by Youtube (or wherever) a proportion of the revenue for the adverts that the hosting site has shown to viewers. Some income also comes from subscribers.
Often they will also make adverts for specific products, but on most platforms it has to be clearly marked as 'sponsored'.
At the more professional end it's pretty much the same as a production company filming a TV show, and selling it to a channel. Indeed some 'content creators' have shifted to making TV/streaming shows.
Just charge 0.1% on every payment into a UK bank account (personal and business). Ignore cash, as it's only used by poor people. Let the banks collect it (they know exactly where all the money is and has been). The big businesses who will use offshore accounts are already dodging tax, so you could probably add 0.01% on every transfer of money overseas.
Might upset the rich and the financial industry, but that would indicate you're doing it right.
Just charge 0.1% on every payment into a UK bank account
How does this work given we have tax bands such as 20% and 50%? Are you suggesting somebody who gets paid £100k or more should be charged 0.1% of that in income tax? Because that might leave a deficit that not even Rishi Sunak could fiddle the maths for.
So if I split the cost of something with a friend, and they transferred the money to me, it would be taxed at 0.01%
Or if I was getting a refund for something?
Wouldn't this hit people on weekly incomes, (who are typically earning less), harder than those who are paid monthly?
If you're going to invent a fantasy tax in future, try and concentrate on it hitting the rich harder than the poor.
"If you're going to invent a fantasy tax in future, try and concentrate on it hitting the rich harder than the poor."
I disagree. You should strive to make the tax a fair proportion across the income spectrum with a lower cutoff below which a person/family does not owe tax and a cutoff of percentages past a certain point. Many "rich" people are really just high income earners that wind up overspending and paying a higher VAT. Very few are truly rich. The wealthy often own things that contribute to their net worth but aren't cash or particularly liquid. The last thing I'd ever want to see is a "wealth tax". That would be a license to steal even more broad than the taxation we have now. A wealthy person might not have a large income so while trying to "tax" the wealthy, you wind up penalizing the people that are trying to become wealthy by earning the money.
Wealthy people and those with high incomes have many more facilities open to them to legally avoid paying taxes. Raise the taxes and they have even more avenues and incentives to invest and store their wealth in other places. For somebody like me, those tactics don't work since it would cost me more money to use them than I would save on taxes.
From what I can gather - on one page of the GOV UK website it says for my circumstances if I earn over £1000 in interest on savings (not including ISAs or Premium Bonds) I'd have to pay tax on it.
Yet when I go through their online questionnaire, it concludes that I don't.
I know this is a separate matter (tax on interest on savings) to the subject of the article. But it beggars belief that HMRC are trying to suggest people are doing the wrong thing, when they are indeed giving out conflicting information on their own bloody website.
>Yet when I go through their online questionnaire, it concludes that I don't.
Interest on UK savings accounts is generally taxed at source at basic rate, hence HMRC will be determining whether your total income goes over the higher rate threshold at which point additional tax become due.
confusing and conflicting advice stems from the fact that the 'online' system is just a patchwork of old, very old, updated old, newish, fairly new - all mixed up and linked up (with many dead links) - and this patchwork is both the substance, i.e. what you read on those pages, and the medium, i.e. how this or that part of the 'system' is delivered and co-works with the rest. Obviously, nobody, EVER checks those bits make sense and 'align' - this might have been an intention, but never implemented. It's a clusterfuck (but then, I could say the same about NHS system, and probably any other gov-related system).
The more you're off their radar the better. This government pish it away on wars you didn't sign up to, handouts for those doing nothing and cash for their billionaire cronies. Hide it. Obscure it. Crypto it. Keep it quiet. Whatever. And if they do give you grief, you make it not worth their hassle. Become super difficult to get hold of. You prolong and delay. You become obnoxious and unbearable to deal with. It's your choice to be complicit to live in their reality and rules.
They should be going after the multinationals, big tech and the high earners. Not those on low incomes, people selling a few naughty pictures or some ink cartridges on eBay.
Look, I think everybody should pay their fair share, but I'm not your customer unless you're providing me with a product or service, which you're not. Yes you're taking my money but don't try to make me think you're doing me a favour - actually you're generating a huge amount of extra work for me with you ludicrously complicated and unintelligible forms
Imagine I create a platform - a cupcake factory, where people can come and make cupcakes if they like and then other people may buy cupcakes off of them and I would take a cut of each sale.
Or I create a supermarket and people can come stack shelves and if I like it I could pay them in tokens.
I am pretty sure something like this would be illegal, but somehow it is allowed when it is on the internet.
Imagine I create a platform - a cupcake factory, where people can come and make cupcakes if they like and then other people may buy cupcakes off of them and I would take a cut of each sale.
I am pretty sure something like this would be illegal, but somehow it is allowed when it is on the internet.
Sounds pretty close to what just about every taxi firm in the country does. They're not illegal.
I think that was Uber (or Uber-alike). I believe the key fact was that they had to take the jobs that the company gave them at the price the company set. My local taxi firm doesn't set prices (the council does that) and they just put jobs out for drivers to say yes or no to as they wish.
"Was not the case recently ruled that people working for a certain taxi firm are actually employees, and not entrepreneurs or independent contractors?"
In other places, everybody working as a driver is an employee EXCEPT for Uber/Lyft. That law is highly challenged as laws in the US have to be equal in application. Giving special dispensation to certain individuals or companies is generally not allowed. In California, the law has meant that shipment brokers that match shippers with truck owners is required to consider the independent owner/operators as employees. This is absurd as those truckers can accept or decline the loads and can makes bids on work if they want to make at least their costs to get back to their home base rather than dragging an empty trailer. It's just a dating site for freight.
Deliveroo editions works like that.
The have a kitchen in a warehouse on some industrial estate. You can get a space in the kitchen, and they take a commission from the orders they receive for your product.
While the tax position on Deliveroo drivers has been challenged, I don't think anyone has a problem with the tax status of the people who make the food. You design the menu and set the prices, customers can choose between your products or someone else's. That is not the case for the delivery drivers.
Imagine I create a platform - a cupcake factory, where people can come and make cupcakes if they like and then other people may buy cupcakes off of them and I would take a cut of each sale.
Sounds like a lease able commercial kitchen facility. We have these in the USA, don't you? Except it is rented by a period of time whether your cupcakes sell or not
"Sounds like a lease able commercial kitchen facility. We have these in the USA, don't you? Except it is rented by a period of time whether your cupcakes sell or not"
The metaphor is messy due to insurance and liability requirements. I'd make the argument using something like a maker space that people can join and use the facilities to make things. The maker space operator is completely decoupled from the things that people create and if they are doing so for their own enjoyment/use or as a commercial enterprise.
Huh?
What makes a Content Creator? Everyone who posts on FB when an email would do? Do comments on The Register get counted as well (though clearly only Gold Badges are getting the big bucks here)?
Maybe I'm a Influencer and didn't even realise (well, 'Er Indoors does day I tell everyone what the ought to be doing)? Let's try: "Buy Wheaty Bits, They're Grrrrrrruel!".
Yes, but when people such as The Chancellor of the Exchequer need professional help when declaring income then there is something wrong with The System. (I'm not just talking about recent, perhaps naive, incumbents of the post).
It is far, far too complex for anyone to understand.
I believe the vast majority of us do want to pay the correct amount of tax, but are fearful of communicating with HMRC*, lest they run into trouble for not saying the right things. They are almost as fearful communicating with an accountant because the clock ticks as soon as the conversation starts. And another thing... Money Laundering regulations make people fearful of speaking to their accountant because they do not know whether the Accountant will report them to the authorities for saying something that triggers the alarm bells.
*Haha, if they can get through.
"I believe the vast majority of us do want to pay the correct amount of tax, but are fearful of communicating with HMRC*, lest they run into trouble for not saying the right things."
In the US, any advice you get from the IRS is not guaranteed. If they give incorrect or bad advice, you may still wind up paying fines and penalties if it leads to you submitting your paperwork incorrectly. If you use (and pay for) a tax accountant, they will often back up their advice/work with committing to pay any fines and penalties if they did something incorrectly. That's predicated on you giving them correct information. They won't have your back if you try to cheat. Is HMRC like this?
I received a big bill from my accountant when I had an HMRC investigation many years ago (which ended up with me not owing or paying anything over and above what I'd already paid to HMRC). Since then my accountant brought in insurance to cover against such investigations (after the horse has bolted).
In fairness, my accountant did warn that the "lumpy" figures being filed could precipitate an investigation, and advised me to accept his suggested amendments to spread out the lumpiness (i.e., to falsify the figures), but as it was my signature that was going on the accounts, not his, I declined on moral grounds. A case of honesty not being the best policy, which does not encourage people to tell the truth.
Things like 'superchat' (a gift given during live streams either to get your question highlighted, or just to say thanks to the creator without signing up to an ongoing subscription)... Under UK law would that not count as a gift, as it's given voluntarily, and NOT as a requirement to participate...
"How the hell can the tax office call taxpayers "customers" ? Seems to be a big stretch of linguistics...."
It's the same as YouTubers saying things like "Today we are going to have a discussion about......" There is no "we" and also no "discussion". I suppose it sounds more friendly but has turned into one of my pet peeves in the same way as books that spend ink on writing down that they are going to cover certain things in the book. Sheez, what a waste. Since I'm often looking for instruction on how to do something when I search YT (if the info hasn't been banned by the platform), I have no issue with the presenter as saying something such as "In this video I am going to show you how to....." I don't mind that sort of preface in a video as it tells me right up front if they are going to cover the thing I'd like to learn.
I keep being told by "influencers" that it's a "real job", so I'm guessing that if the government accepts it as a real job, and they pay taxes, then they may be right :-)
Interesting point about the $1,000 (?) from online activities, I'll have to check my Google and Amazon clickbait payments :-o
The Treasury / HMRC are for profit companies with entries on Dun & Bradstreet. As such, they relinquish their "sovereign" status and are required to adhere to the Companies Act 2006 and contract law. If HMRC demands money from you, ask to see the contract between you and them. They won't be able to produce it, because it doesn't exist. No contract, no obligation and you could argue that in court and win. The same with council tax. All government bodies are for profit companies, including the police and the courts - they have the same amount of power over the population as McDonalds or Tesco. The Clearfield Doctrine states that any for profit organisation is not fit to govern.
There's also the small other detail of a court case in 2011 where it was found at Southwark Crown Court that it is highly probable that the UK gov funds and creates terrorism. Under the Terrorism Act 2006, anybody who knowingly funds an organisation that's involved in terrorism can themselves be prosecuted for funding terrorism, <cough> tax.
You may find that if you can pay the tax required by law to the relevant bit of government, but without going through HMRC (or the equivalent for local government) then you might indeed get away with it when (not if) you land up in court. But that's a big "if", because ... the "service" they provide is "vouching to the government that you've paid the tax that the law requires" and I rather suspect that they are the monopoly provider. (I expect that's also the sense in which you are their "customer".)
I got this tale out of him drunk once. That he decided that he would go after the big fish, and was almost instantly stomped into place because they all made fantastic "political contributions" every year and as such were basically not allowed to be touched. Stick to the middle fish, you can even go after the top end of the middle fish. And that the small fish cost too much for too little in return.
She put this down to crossed wires over the income tax-free personal allowance of £12,570 ($14,986.46) – the thinking being "I didn't make that much so I don't have to pay tax on it." In reality, online income over £1,000 ($1,192.24) counts as "trading" and is therefore taxed.
So if you're self employed you dont get a " tax-free personal allowance " ???
"So if you're self employed you dont get a " tax-free personal allowance " ???"
Not in the US and I suspect that every other first world country just copies the things they see other first world countries getting away with. As long as it doesn't impact political campaigns, they'll all tax as much as they can.
OK, it probably wasn't actually intending that its marketing research would wake up the pencil pushers at HMRC, but it accidentally highlighted another risk of using its software other than data acquisition of both creators and those that watch what they produce, but it all adds up.
It appears you may be saving a lot more than just money by avoiding Adobe..
I'm surprised HMRC have been so tardy at tapping such an obvious source of revenue.
"(Apparently there is a distinction between content creators and influencers, though we're not sure what it would be. Maybe the first actually does something creative and the other stands there holding a product and looking cool.)"
That is an extreme;y good description.
"However, considering that a large proportion will be young, they're not willfully tax dodging – they're just incompetent.:" Hmmm and Hmmm.
""However, considering that a large proportion will be young, they're not willfully tax dodging – they're just incompetent.:" Hmmm and Hmmm."
How to run a small business is another course that should be taught in the last couple of years of school. Taxes, insurance, having employees, accounting, etc. There are often government booklets prepared to help a person starting their first small business, but I've never seen one that is even mildly interesting. Most of them are horribly out of date by the time they've been approved for publication after 10 years of writing (the first 6 months is the writing and the next 9-1/2 years is tidling edits and approvals).
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