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Banking institutions around the world share information with revenue authorities, giving SARS access to foreign and domestic bank account details.They say you can't escape your tax obligations. Jonty Leon.
In the field of social media, South African influencers have gained immense popularity and amassed followers, likes and shares.
However, there is a widespread misconception among them that their income is tax-free. The fact is that income earned from influencer activities, including sponsored posts and partnerships on platforms such as OnlyFans, is fully taxable and must be declared to the South African Revenue Service (SARS).
The digital environment has revolutionized the way individuals earn income, allowing influencers in a variety of fields, including fashion, fitness, lifestyle, and content creation, to leverage their online presence for financial gain. became.
Despite having significant influence over their audiences and brand partnerships, many influencers are unaware of the tax implications associated with their online businesses. This oversight can have serious consequences, as willful failure to disclose income to SARS constitutes tax evasion and is a criminal offense, including fines and imprisonment.
One common misconception, especially among influencers who earn their income from overseas, is that payments from abroad are not taxable in South Africa.
However, South African tax residents must declare their worldwide income, regardless of its source or place of deposit.
Even if your income is deposited into a foreign bank account, it does not exempt you from paying tax in South Africa.
A question that often arises is, “How will SARS know if I fail to declare my income?”
The reality is that any attempt by SARS to hide its income carries far greater risks than compliance. Banking institutions around the world share information with revenue authorities, giving SARS access to foreign and domestic bank account details.
You cannot escape your tax obligations.
Tax rates vary – here's how to follow
In South Africa, personal income tax rates vary on a sliding scale from 18% to 45%, depending on income earned within the tax year from 1 March to the end of February of the following year.
For influencers who perceive their careers as operating in a gray area beyond the reach of tax authorities, navigating the complex area of tax compliance can be daunting. However, with the advent of digital auditing tools, concealing income has become increasingly difficult.
To ensure compliance:
- Learn about your tax obligations and seek professional advice if necessary.
- Maintain thorough records of your income and expenses, including revenue from all platforms.
- We practice transparency by proactively disclosing our revenues to SARS and promptly fulfilling our tax obligations.
The idea that influencers' income is not taxed in South Africa is incorrect. Influencers must accept fiscal responsibility and comply with tax laws to protect their financial future.
By focusing on tax compliance, influential people in South Africa can avoid the consequences of non-compliance and ensure long-term financial security.
Jonty Leon is a Managing Partner at Leap Group, where he helps influencers navigate complex tax compliance.
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