Brand Deals and Tax: What Every UK Influencer Should Know

Brand deals can be one of the biggest sources of income for influencers. Whether you are paid to create an Instagram post, YouTube video, TikTok, blog article or product review, it is important to understand how that income may be treated for tax purposes.

For UK influencers, brand deals can involve more than a simple payment. You may also receive free products, services, commissions or other benefits from a brand. Keeping proper records of everything you receive can help you manage your tax responsibilities and avoid problems later.

Are Brand Deal Payments Taxable?

If you are carrying on a trade as an influencer, income from your brand collaborations will generally form part of your trading income.

This can include payments for:

* Sponsored social media posts

* Product reviews

* YouTube videos

* TikTok content

* Instagram collaborations

* Brand ambassador agreements

* Affiliate commissions

* Promotional campaigns

* Content creation services

HMRC explains that income from creating online content can include money, gifts and services received for promoting products online.

This means influencers should keep track of all their brand income rather than only recording payments that arrive directly into their bank account.

What About Free Products From Brands?

Free products can be an important part of influencer collaborations, but they should not automatically be ignored when reviewing your income.

HMRC's guidance specifically states that income from online content can include gifts and services received from promoting products online. Where gifts or services are received instead of money, HMRC says you should use the value of what it would have cost if you had to pay for it.

For example, imagine a brand pays you £500 to create content and sends you a camera worth £800 that you are allowed to keep as part of the arrangement. The tax treatment needs to consider both the cash payment and the non-cash benefit, depending on the facts of the agreement.

Keep records of gifted products, including the brand, date received, description and value.

Do You Pay Tax on Every Brand Deal?

Not necessarily. Your tax position depends on your overall circumstances and how your income is calculated.

For individuals carrying on a trade, the £1,000 trading allowance may be relevant. HMRC states that if your total trading income is more than £1,000 in a tax year, you may need to tell HMRC about it. Importantly, this threshold relates to total trading income rather than one individual brand deal.

If you are already running an established influencer business, your brand deal income will normally form part of your wider business income and should be included when working out your tax position.

Keep Records of Every Brand Collaboration

Good record keeping is essential when working with brands.

For each collaboration, consider keeping:

• * The brand's name and contact details
• * Your contract or agreement
• * Invoices issued
• * Payment dates
• * Amount received
• * Details of products or services received
• * The agreed value of non-cash benefits
• * Relevant business expenses
• * Bank statements and payment records

Some platforms may also report information about sellers to HMRC. However, platform reporting does not replace your responsibility to maintain your own business records and work out your tax position.

What Expenses Can Influencers Claim?

Running brand campaigns can involve various business costs. Depending on your circumstances, some expenses may be deductible when calculating your taxable profits.

Examples may include:

• * Content creation equipment
• * Editing software
• * Website costs
• * Advertising and marketing
• * Professional accounting fees
• * Business insurance
• * Certain travel costs
• * Business-related phone and internet costs

The expense must meet the relevant tax rules. Not every cost connected with your influencer activity will automatically qualify.

Keeping receipts and other supporting documents makes it easier to identify genuine business expenses and provide evidence if required.

What If You Have a Full-Time Job as Well?

You can be employed and run an influencer business at the same time.

If your brand deals are part of a separate self-employed activity, you may have reporting responsibilities for your influencer income in addition to your employment income.

This is particularly important for creators who start accepting occasional collaborations while working a full-time job. As the activity grows, it may become a regular trading business.

What About Overseas Brand Deals?

Influencers can work with brands based outside the UK, which can make record keeping more important.

Keep details of:

• * The country where the brand is based
• * The currency used
• * The amount agreed
• * The amount actually received
• * Any fees deducted
• * The date of the transaction
• * The agreement or invoice

If you receive payments in another currency, make sure your records show how the amount was converted for your UK tax records.

Depending on the services you provide and where the customer is located, VAT and other rules may also need to be considered.

Do Brand Deals Need to Be Labelled as Ads?

Tax and advertising rules are separate issues, but both matter to influencers.

The CMA guidance says content creators should clearly label incentivised content as an advert or ad. This can apply where you have been paid, received gifts, or have another commercial relationship with a brand.

Therefore, an influencer should consider both their tax responsibilities and their obligations when publishing sponsored content.

When Should You Speak to an Accountant?

As your brand deals increase, managing multiple payments, expenses, gifted products and different platforms can become difficult.

An accountant who understands influencer businesses can help you organise your records, understand your tax position and keep your financial information up to date.

This can be particularly useful if you have several income streams, work with overseas brands, receive high-value products or are considering setting up a limited company.

Final Thoughts

Brand deals can provide valuable income for UK influencers, but it is important to treat them as part of your overall financial records.

Keep track of cash payments, gifted products, services, commissions and related expenses. Do not rely solely on platform statements or bank transactions. Good records can make it much easier to understand your income and meet your tax responsibilities.

If your influencer business is growing, getting professional accounting advice can also help you manage your finances as your brand partnerships become more complex. Influencers Accountants can help UK influencers keep their financial records organised and understand their accounting and tax responsibilities as their income grows.