The recently released guidance on tax treatment for influencers by the Irish Revenue Commissioners (“Irish Revenue”), Part 04-01-22 on Taxation of Income from Social Media and Promotional Activities and The VAT treatment of Social Media Influencers, meaning that PR, free gifts and experiences are now firmly on Revenue’s radar, and unreported collaborations can lead to tax trouble for nano and micro content creators.

Nano and micro content creators are driving the creator economy, but this also means they are the most exposed to tax risks. Smaller social media creators often start with engaging in casual agreements, one-off-brand deals and small scale paid collaborations. While this may feel informal, it still carries formal tax obligations. 

Here are the five most common risks nano and micro content creators might not even realise they are taking, when accepting gifted or paid collaborations.

1. Treating "Free Gifts" as if they aren't Measurable Income

Under new tax rules, non-cash benefits such as things like press trips, hotel stays or flights, provided in exchange for promotion are also generally considered taxable income. 

2. No Proof of Posting

Most micro and nano content creators rely on DMs and conversational agreements.

This can prove as a future headache as creators, regardless of follower count, are required to provide documentation for collaborations. If you don’t have clear records of what was posted, tax authorities can apply their own assessment of the transaction, which can lead to unexpected tax liabilities.

3. Guessing the Value of Gifts

Under-valuing gifted experiences, stays or items, even accidentally, can look like under-reporting. Valuations provided to tax authorities must be based on the fair market value. 

4. Viewing Content Creation as "Just a Hobby"

When social media promotion of any kind in exchange for a monetary benefit happens, tax authorities view this as business activity, not just a passion project. 

5. Accidentally Triggering VAT Rules

Receiving high-value gifts, experiences or services can push nano and micro content creators closer to VAT thresholds (which stands at €42,500 annually in the case of persons supplying services only), even without ever receiving a cash payment.

So the question remains, how can micro and nano content creators protect themselves from tax risks? 

Track every gifted collaborations (regardless of value). 

Keep proof of what you have posted (stories disappear, tax audits don't). 

Record brand expectations (expectation= deliverable = taxable). 

Store all your documentation for up to six years.  

Prepare your yearly statements (paperwork now means peace of mind later).

However, Irish content creators don't have to get out the spreadsheets just yet, the good news is, all of this can now be done automatically with AnotherTrip, the new collaboration management tool for content creators, and businesses engaged in social media marketing. 

AnotherTrip now provides content creators with; 

✔️ Fully exportable audit packs.  

✔️ A dual-invoicing system (keeping you & the brands you work with compliant). 

✔️ Automatic checks of all previous content for collaborations and gifts, and compiles records automatically. 

✔️ Generates fair market valuations of all gifted items

All provided in a single secure dashboard, to keep creators on top of their tax obligations. 

Information provided courtesy of the Revenue Commissioners under a Creative Commons Attribution 4.0 International (CC BY 4.0) licence. 

The above service and information is not affiliated with, associated with, or endorsed by Revenue. It is an independently developed resource. The information contained in this article is intended for educational use only and should not replace professional advice. AnotherTrip advises to seek support from a qualified tax advisor for any specific queries.