Income Received Via Blogging, Instagram And YouTube Now Taxable In Singapore
Just yesterday, some fellow bloggers have revealed that they received a letter from the Inland Revenue Authority of Singapore (IRAS), requiring them to clarify their income sources, which include products or services received via their websites.
According to the online statement, "Payments in exchange for services performed by social media influencers such as bloggers, YouTubers, etc. can take the form of money, goods or services. All monetary and non monetary payments / benefits-in-kind are taxable if they are given in return for services rendered or to be rendered by you. Any benefits whether monetary or in-kind provided to your family and friends will be taxable in your name."
Declare sponsored items, bloggers told by Iras
Sponsored trips to Hong Kong Disneyland, an invitation to family and friends for a meal tasting session or a package of the latest beauty items.
These are some of the products or services that bloggers or "social media influencers" often receive from companies keen for them to spread the word about their products.
Now the taxman has come knocking on their doors to remind them that such "non-monetary benefits in kind" must be declared as part of their income by next month.
Bloggers in Singapore to Pay Income Tax to IRAS – even for food tastings!?
Just read the news on Facebook – apparently, numerous bloggers in Singapore (i.e Xiaxue) were issued with the IRAS letter informing them to pay taxes on their social media marketing activities recently..
This is applicable to ALL Social Media Influencers – Bloggers / Instagrammers / YouTubers / Dayre / Snapchat, etc
"Payments in exchange for services performed by social media influencers such as bloggers, YouTubers, etc. can take the form of money, goods or services. All monetary and non monetary payments / benefits-in-kind are taxable if they are given in return for services rendered or to be rendered by you. Any benefits whether monetary or in-kind provided to your family and friends will be taxable in your name" – IRASread more
You Get Paid, Now Its Time To Pay
It’s Income Tax filing time in Singapore and some bloggers were shocked to receive the news from IRAS that they have to file for tax too. Yes dear, you are paid by brands, agents and agencies for work done, and now it is time to pay your dues.
All individuals earning, deriving or receiving income in Singapore need to pay income tax every year, unless specifically exempted under the Income Tax Act or by an Administrative Concession. If you’re a Singaporean or have been staying in Singapore long enough, you know there’s no free lunch here in Singapore. As long as you receive payment in return for a blog post, a shoutout on Instagram or sharing of a post on your Facebook page, all these are taxable income.
However, there’s one thing that’s very grey in the IRAS FAQ for Social Media earning. It is the part where benefits or in-kinds have to be declared too in our Income Tax. See the last point in the document published on IRAS website here.
IRAS claims taxing bloggers is part of its regular engagement
Inland Revenue Authority of Singapore (IRAS) is now requiring bloggers to declare income components (including products or services received via their websites) as part of their annual Income Tax Return.
Several members of the blogging community have expressed surprise at this new requirement by IRAS. But according to the radio station 938LIVE, the IRAS letter sent to bloggers is “part of its (IRAS) regular engagement with the self-employed. It is not meant to target or clamp down on bloggers, IRAS said.
The move by IRAS seemed “stringent and rather extreme”, said blogger Alvin Lim, who owns alvinology.com and asia361.com. “If this is really true, it will kill the whole blogging scene. Who will go for food tastings now? IRAS also has to be fair to bloggers – most of us are one-man shows with no resources to do these things,” Mr Lim said.
Bloggers taken by surprise by IRAS letter on taxable income
Some members of Singapore’s Blogging community have expressed surprise at a letter they have received from the Inland Revenue Authority of Singapore (IRAS) clarifying income components - including products or services received via their websites - which need to be declared as part of their annual Income Tax Return.
938LIVE has seen pictures of the letter in question. The memo states that all non-monetary benefits, including sponsorship of products or services received in return for writing or reviewing the sponsors’ products 'may be taxable and must be declared'.
Prominent Blogger Wendy Cheng, or Xiaxue, told 938LIVE this is the 1st time she has received such a letter from IRAS
Income Received from Blogging or other Social Media Marketing Activities
All payments and benefits derived from the carrying on of blogging or any other marketing activities performed on social media platforms constitute gains or profits from a trade or a business under section 10(1)(a) of the Income Tax Act (ITA).
Payments in exchange for services performed by social media influencers such as bloggers, YouTubers, etc. can take the form of money, goods or services. All monetary and nonmonetary payments / benefits-in-kind are taxable if they are given in return for services rendered or to be rendered by you. Any benefits whether monetary or in-kind provided to your family and friends will be taxable in your name.
You can claim expenses incurred against this source of income provided the expenses are incurred wholly and exclusively in the production of the income under section 14 of the ITA and not prohibited under section 15 of the ITA. You can also claim capital allowances for capital expenditures incurred on the provision of plant and machinery for the purpose of your marketing activities on your social media platforms.
IRAS Taxing Bloggers – Come Let’s Break It Down
So it is the talking point these couple of days among blog publishers (bloggers) and agencies who engages bloggers or influencers. The whole IRAS issuing letter to bloggers asking them to file their income tax is causing much destress amongst the blogging community in Singapore. With Income Tax e-filing due in a month’s time, all who have been blogging, attending media invites, accepting media gifts, going for previews etc are confused as to whether or not they need to file for tax. The general sentiment I’m getting from those bloggers who are discussing this, they are not trying to escape from filing their income tax, the big question is where, what and how should they start?
When IRAS sent out the letter and published it on their site, I hope they have done enough research and focus group with bloggers, media owners and even agencies to find out the ins and outs of the whole ecosystem before taking any action. From the looks of the slightly-longer-than-one-page very abstract and none specific letter they published, this does not seem like a very well thought out plan.
Let’s all break the whole ecosystem down and look at the many parts, facts and factors that should be taken into consideration before this IRAS tax guideline is published.
IRAS, Singapore’s tax authority to start taxing bloggers – some clarity needed
So, all the active online folks from bloggers to social media influencers to YouTubers to Instagrammers are all discussing about the tax collectors knocking at our doors.
What is next?
Here is the link to the full IRAS document with regards to “Income Received from Blogging or other Social Media Marketing Activities” for background.