With the rise of the creator economy, influencers in the UK are earning income through various channels, including sponsored posts, affiliate marketing, YouTube ads, OnlyFans subscriptions, digital products, and more. But with increasing earnings comes the responsibility of understanding and managing your tax obligations. Fortunately, there are several smart ways to legally reduce your tax bill while staying compliant with HMRC. Here's how you can save taxes as an influencer in the UK.
1. Claim Allowable Business Expenses
One of the most effective ways to lower your tax liability is by claiming all allowable business expenses. These are costs you incur wholly and exclusively for your influencer work. Common examples include:
Camera and filming equipment
Editing software subscriptions
Office or studio rent
Phone and internet bills (business portion)
Travel for content creation
Website hosting and domain fees
Professional services like graphic design, photography, and video editing
Keep all receipts and maintain clear records. The more legitimate expenses you can claim, the lower your taxable profit.
2. Use the Trading Allowance (if eligible)
If your total income from influencing is under £1,000 in a tax year, you may not need to register for Self Assessment or pay any tax at all, thanks to the £1,000 trading allowance. For those earning slightly more, you can choose to deduct the trading allowance instead of actual expenses if it's more beneficial.
3. Set Up a Limited Company
Many influencers start out as sole traders, but as your income grows, it may be more tax-efficient to operate through a limited company. This allows you to pay yourself via a combination of salary and dividends, which can result in lower overall tax compared to being self-employed. It also opens up more planning opportunities, like:
Splitting income with a spouse or partner who is a shareholder
Claiming additional business expenses
Deferring income to future tax years
Setting up a company comes with more admin and costs, but the potential tax savings can outweigh these if your profits are consistently high.
4. Make Pension Contributions
Pension contributions are an excellent tax-saving strategy. If you’re a sole trader, you can get tax relief on your personal pension contributions. If you operate through a limited company, the company can make contributions on your behalf; these are typically considered allowable business expenses and can reduce your Corporation Tax bill.
5. Keep Your International Income in Check
If you're earning income from overseas platforms or working with international brands, this still counts as UK taxable income. However, Double Taxation Agreements (DTAs) between the UK and other countries may help you avoid being taxed twice. Working with a specialist can ensure you stay compliant while minimising unnecessary tax.
6. Work With Accountants for Influencers
Navigating tax as an influencer can get complex quickly, especially as your income sources grow. That’s why working with accountants for influencers who understand the digital creator economy is essential. They can help you optimise your structure, claim the right expenses, stay compliant with HMRC, and ultimately save more of what you earn.
Final Thoughts
Taxes don’t have to be overwhelming, even for influencers with multiple income streams. With smart planning, accurate record-keeping, and professional guidance, you can stay on the right side of HMRC while keeping more of your hard-earned income. Whether you're just starting or scaling your influencer business, taking control of your tax strategy now will pay off in the long run.