Influencers such as entertainers, internet personalities, celebrities and sportspeople can earn income from many sources, including wage and salary, bonuses, investment and business income.
As an Influencer, when you begin to develop a public following and fame, you may also earn income from the use of your image or fame, and you will need to pay tax on everything that can be related to your reputation or appearance. This includes your image, name, identity, likeness and signature, regardless of your profession or how you became famous. This can also comprise of sponsorships, including wearing associated brand products, advertisements, the promotion of products and public appearances.
This type of income stream is generally taxed similarly to other forms of income, provided it is earned by the individual. However, many of those with fame have licenced their image rights to another entity, such as a trust or company. Any income resulting from the use of their fame or image goes to that entity instead of the individual.
It’s important that you declare your assessable income from all sources that it has obtained from which includes income made through endorsements, sponsorships and non-cash benefits. If income is not correctly reported, this can become an issue that may trigger ATO audits.
There are a lot of influencers that don’t understand that the ATO has many data matching tools at its disposal now to check if you are reporting all your income, so it really does make sense to ensure you are accurately declaring it and being taxed accordingly.
Besides, there are many genuine deductions you can claim, and chances are, you’re missing many of them! This is something that the awesome staff at Paris Financial can help you with!
Contact our tax champions today!