Financial influencers should disclose their taxable income to the German tax office (Finanzamt) - Influencers Required to Submit Tax Documents (Factual Statement)
In North Rhine-Westphalia (NRW), Germany, a special unit within the tax authority has been established to investigate tax matters related to social media influencers. The unit, which commenced operations at the start of the year, is focusing on activities on platforms such as Instagram, YouTube, and TikTok.
The investigation is not confined to a specific time frame and is ongoing. The data being analysed by the special unit suggests that influencers from NRW have potentially evaded 300 million euros in taxes.
According to German tax law, all income earned from online activities, including sponsored posts, affiliate marketing, and advertising, is considered taxable. Influencers can deduct business-related expenses, such as travel costs, equipment purchases, and marketing expenses, provided they are directly related to their business activities.
Influencers are required to register with the tax office (Finanzamt) and obtain a tax identification number (Steuernummer) if they earn income from their online activities. They are also required to file annual tax returns, detailing their income and deductions, including reporting all income earned from social media activities and deducting legitimate business expenses.
It's crucial for influencers to distinguish between business and personal activities when claiming deductions, as personal expenses are not deductible. They should maintain accurate records of their income and expenses and consult with a tax professional if necessary.
The special unit is not a team of administrators dancing on TikTok, but rather tax investigators. Their role is to ensure that influencers comply with German tax law and pay their fair share of taxes. The tax authority in NRW encourages all influencers to be transparent and comply with their tax obligations.
- The special unit within the tax authority, responsible for investigating tax matters of social media influencers in North Rhine-Westphalia, is in charge of examining community and business policies related to employment on various social media platforms, considering there might be financial implications due to potential tax evasion amounting to 300 million euros.
- Given the ongoing investigation by the special unit, it is essential for influencers from NRW to maintain a clear distinction between their business and personal activities, accurately recording income and expenses, and adhering to German tax law, which includes registering with the tax office, obtaining a tax identification number, and filing annual tax returns, while also being mindful of technology-driven changes in the employment policies for social media influencers.
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