“If you’re doing it, we will know about it.” That’s the warning from the chairman of the Revenue Commissioners Niall Cody.
The taxman is watching online and paying more attention than ever to the activities and earnings of Ireland’s best-loved influencers, content creators and social media personalities.
According to Revenue audits carried out on earnings between 2020 and 2024, about €3.3 million in outstanding tax is owed by this group of newfangled celebrities.
Prominent names have begun popping up on the tax defaulters’ list.
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They include OnlyFans content creator Matthew Gilbert, who goes under the name “The Irish Viking”.
After revealing in an interview in 2021 that he was earning more than €54,000 a month on the adult subscription service, Gilbert made tax settlements with Revenue of more than €350,000 at the end of last year.
Asking people to talk about their earnings and tax affairs is not easy.
[ Time for social media stars to grow up when it comes to taxOpens in new window ]
One social media personality with millions of followers declines to comment on the guidelines from Revenue beyond saying: “I still have to get my head around them myself – so I have nothing too interesting to say about it [laughing face emoji].”
Several other big “macro” influencers decline to respond to gentle invitations to talk.
The latest guidance from Revenue makes it clear that all social media income-generating activity is taxable, regardless of whether it is on a full-time basis or casual. This covers social media promotions, advertising and collaborations. It is also clear that gifts and freebies received in exchange for promotion may have tax implications.
As the traditional advertising models have edged towards obsolescence, brands now see great value in having their products in the hands of “influencers”. A well-placed collaboration or endorsement can put millions of eyeballs on their goods.
‘Once you are earning more than you need to survive – over and above the amount needed to pay the mortgage, car loan, living expenses etc – it would make sense to form a limited company and leave this money in the company to be taxed at 12.5 per cent’
— Tax adviser Enda Callan
As Revenue has sought to keep up with the evolving nature of digital platforms, tax experts report that its message about compliance seems to be getting through, but there is much confusion around the rules.
“There’s been a few [content creators] knocking on the door recently, and a lot of them don’t understand what’s required,” says Dublin-based tax adviser Enda Callan.
“Revenue is getting a lot better lately at tracking social media.”
John Galligan, tax director of accountants KPMG, says the nature of the social media industry makes it hard for those involved to hide.
“Revenue have always utilised information provided by the public as a tool to tackle tax evasion, but you are now in a new world where people are showcasing their level of activity directly to Revenue through their online presence,” he says.
Galligan says the taxman started taking these earnings more seriously in 2023, and the issuing of “manuals” over the summer suggests Revenue has teams dedicated to monitoring online activity.
So what should an influencer who has made some money recently do next? It all depends on the scale of their earnings.
Social media certainly can pay well, depending on one’s follower count and engagement levels, but there is another layer of influencers who fall well below this kind of threshold.
For smaller “micro” influencers, occasional collaborations and large viewing figures can amount to a useful supplement to their income, but in many cases little more.
Callan says many are unaware that even the smallest earnings need to be declared.
“There is a common misconception among a lot of people that if their income from social media is below €5,000, they don’t have to declare it. While they aren’t obliged to file a form 11 income tax return, they are obliged to declare this additional income on their Form 12 PAYE return,” he says.
“It is still taxable, and they need to get their house in order and do returns for that.”
He says those who earn more than €5,000 per annum are obliged to register as self-employed and submit a form 11 income tax return by October 31st the following year.
Callan says the biggest misunderstandings are related to commercial endorsements where no money changes hands.
“Say a hotel down in Galway says you can come down for two nights – ‘We won’t charge you, but you agree to do a video on it’ – many would think it is tax-free,” he says.
“But where goods or services are provided in exchange for promotion, Revenue would generally expect the value received to be treated as taxable income.”
Thalia O’Toole, tax principal at KPMG, says the recent push from Revenue also follows enhanced awareness of barter-account arrangements seen recently across the media industry.
“They are interested in the free use of goods, like cars, where you turn up at an event or where you receive a free product or service and you review it, effectively an exchange for that product – the barter concept,” she says.
“It’s one of two things: either you aren’t doing anything in exchange for something and it’s deemed to be a gift – and gift tax could then apply to it – or you are performing a service in exchange for its receipt, and it’s likely to be taxable trading income.”
The other big issue that influencers need to consider is value-added tax (VAT). If their earnings for the year surpass €42,500, then VAT will be due.
Then there is the category of big social media personalities. Many of these have millions of online followers, post on Instagram and TikTok every day, and regularly feature commercial tie-ups.
Callan says if someone is making considerable money, then registering as a company makes financial sense.
‘Revenue’s approach in this area is focused on supporting voluntary compliance. Engagement with creators typically begins with education and guidance, with risk-based compliance interventions applied where necessary’
— Revenue spokesperson
“Once you are earning more than you need to survive – over and above the amount needed to pay the mortgage, car loan, living expenses etc – it would make sense to form a limited company and leave this money in the company to be taxed at 12.5 per cent, rather than at the marginal tax rate for a sole trader,” he says.
“Let’s say the creator makes a profit of €200,000 – you take out €70,000 or €80,000 as a salary and the balance left remains in the company and gets taxed at 12.5 per cent as opposed to the higher income tax rate.”
Recent headlines about tax audits, penalties and fines may have spooked some content creators. Tax advisers claim that the very worst can be avoided in most cases, if the individual is transparent about their earnings when first contacted by the authorities.
When it comes to missed deadlines, John Galligan says avoiding the tax defaulters’ list depends on a few things.
“There will probably be initial questions around earnings [from Revenue] which would then invite the influencer to make a disclosure,” he says.
“They may still pay a penalty, but it would depend on the level of default.”
Thalia O’Toole agrees.
“If you are talking about someone who has been careless in their tax-compliance obligations, is fully co-operating with Revenue and the penalty rate agreed with Revenue is below 15 per cent, you would generally avoid the defaulters’ list in those circumstances.
“However, deliberate [non-compliant] behaviour, the size of the settlement or poor co-operation levels can lead to larger penalties being levied, and that could land you in publication territory.”
A Revenue spokesperson strikes a similar note.
“Most creators want to get things right,” she says.
“Revenue’s approach in this area is focused on supporting voluntary compliance. Engagement with creators typically begins with education and guidance, with risk-based compliance interventions applied where necessary.”
Outside of tax, there is also the issue of compliance with advertising rules that influencers must now contend with.
The Competition and Consumer Protection Commission (CCPC) consumer watchdog has been more visible in taking action against paid-for social media posts that aren’t clearly labelled as such.
Former Irish rugby international Brian O’Driscoll was found to have “engaged in a misleading commercial practice” after the CCPC examined an Instagram post connected with the Zerofit clothes range.
The pundit was directed to “ensure that in all instances where a trader has paid you to use editorial content in the media to promote a product or service, you must make it clear that such promotion is a paid promotion”.
At about the same time, fitness coach Caroline O’Mahony, who has more than 800,000 followers on Instagram, was found to have failed “to use the appropriate labels” to disclose the commercial nature of content she had published, which related to her fitness business.
The CPCC wrote to 26 influencers reminding them of their obligations under consumer protection law.
What may have started out for many people as a fun and novel way to make a little money now looks a lot like old-fashioned hard work.
