Preparing your influencer business for the upcoming tax season

So you're an influencer. You set up your business, you've spent your year worrying about creating content, meeting brand deadlines and engaging with your community.

You didn’t keep track of your income and expenses all year, and now tax season is looming over you like a bad horror movie.

Organising receipts? You were going to get to that later...

Don’t panic, yet. While it’s definitely not ideal, there’s still time to get your finances in order before the tax deadline hits.

But, let’s be real: it’s going to take a lot of work (and probably some deep sighs of regret). You are going to have to spend your evenings organising your receipts, invoices and financial reports instead of going out for dinner with friends.

Where do you even start?

Here's a guide you can follow to make this process as smooth as possible!

Get your influencer income and expenses organised for your taxes

You are going to need every single piece of financial proof you can find.

1. Bank statements

2. Paypal statements

3. Stripe statements (and other payment processors)

4. Invoices to brands

5. Receipts

   
   

Start with downloading all of your statements from all your relevant banks, including payment processors like stripe. You will need to see the starting balance on the 6th of April and the closing balance on the 5th of April as this is when the financial year starts and ends in the UK.

To make it easier on yourself, download your statements as excel files. Even if you don't have excel, you can upload them to google sheets! This is going to be the foundation you work from for your influencer taxes.

Why?

Because you are going to want to tally up your income and your expenses so you can get an estimate of your revenue. This is what you will pay corporation tax on.

You can roughly estimate how much tax you will owe by taking 20% of that number. You have until 9 months and 1 day after the end of your company's financial year to pay your tax.

It is not uncommon for an influencer to not have a business set-up.

You may be working as a sole trader. In this case, you still need to report your income but you will need to do it via your self-assessment. Any income you've made from your influencer side-hustle needs to be reported as soon as you hit £1000. You'll still need to organise all of your income and expenses in order to be able to report an accurate figure!

If you are filling a self-assessment, you have until the 31st of January to submit and pay your first payment on account. Your second payment on account is on the 31st of July.

Once you've got all your statements, you can choose where to start.

1. Expenses

2. Income

Influencer Expenses

I find expenses are the most time consuming to deal with, since you will need to hunt down every single receipt for all of the payments you made throughout the year.

As an influencer you will have so many different types of expenses to deal with: software subscriptions, receipts for meals you had on a content creation day out, travel expenses, props, etc.

This is why I prefer to start with the expenses. Get the hard part out of the way before you get exhausted!

First, identify your monthly subscriptions. These are the easiest to get receipts for.

Once you've identified them all, go download all of your receipts. Rather than doing this per month, do this per subscription. You will be on the billing page, so you might as well get all of your receipts in one go.

Quick tip: rename your receipts to include the company name and the date of the receipt! This will make it easier for your accountant to match the receipt to the transaction. Next, see if there are any personal expenses you accidentally charged to the business.

These are not tax deductible, so you will need to exclude them. You can create an invoice to yourself to pay these back if you want. This is irrelevant if you do not have a business set up. Lastly, sort out your one-off expenses. If you haven't been keeping your receipts in order, these are the ones you are most likely not to have receipts for.

It isn't the end of the world, but if you do get a tax audit, this could be an issue. Especially if you are VAT-registered.

Influencer Income

As an influencer you will have multiple sources of income

1. Affiliate links

2. Brand deals

3. Social media

4. Gifted items

Most of these are straight forward. For affiliate links, you should have a dashboard that tells you exactly how much you earned from your affiliate links. For brand deals, you should have invoices that you sent to the brands. For your social media income (Youtube adsense, TikTok creator fund) you will be able to find payment history in your accounts.

Gifted Items

This may come as a surprise to you but yes, gifted items need to be reported to HMRC if you used them to create content. You will have to find the value of these items and report them as payment in kind. This is also needed if you do not have an influencer business set up.

Reporting your taxes

Once you've got everything organised it's time to send it all over to your accountant.

A good accountant will help organise your expenses in the right categories and may even find more deductibles and tax reductions for you.

If you don't have an accountant, it's time to fill out your self-assessment on the HMRC website.

Never let this happen again!

But honestly, why go through this stress at all?

I know, I know.

You meant to keep track of your finances, but content creation took over, and now you’re paying the price. But let’s make this the last year you go through this chaos. From now on, you are going to stay on top of it.

If this sounds like an absolute nightmare you’d rather avoid next year, let me help! I can track your finances throughout the year so you’re never stuck in this mess again. I can even help you sort out this year's mess.

Get in touch with me, and let’s get you organised.