Social media influencers are recruited to promote products and servicers. Picture: iStock
The South African Revenue Service (Sars) has moved to clarify its position on social media influencers in the country, and how its new categorisation of the field will work.
In August, Sars announced it had created a new category of tax focus for social media influencers, which created concerns among those who earn a living from marketing products and services online.
Influencers
Social media influencers are recruited to promote tech products and market services to the their large following in various platforms. They are remunerated with products or monetarily.
These are technologically savvy individuals who have identified a niche in the market to provide a generalised offering that leverages their social following.
Sars said in terms of the new segments, such as the social influencers’ economy, it understands that traditional marketing campaigns are increasingly digitising through smart technologies.
“It must be reiterated that it remains the social influencers’ legal obligation to declare all income received.
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Disclosure
Full voluntary disclosure is critical. No matter how social influencers are remunerated — whether with products, services, or travel — all of these are deemed as income (ITA) and must be taxed accordingly,” Sars said.
Social influencers are encouraged to declare:
- Income earned from brand collaboration
- Income earned from sponsored content
- Income earned from affiliate marketing
- Income earned in cash, products, or services
Honesty
Sars says it believes that social influencers will declare honestly when adequately educated
“Although the social-influencer segment has its own nuances, it is no different to other taxpayer segments in that income earned must be disclosed and taxed. Freelance work is similar. Citizens working as social influencers are encouraged to declare income earned from brand collaboration, sponsored content, and affiliate marketing, whether they have been paid in cash, products, or services,” Sars said.
“These taxpayers, like all others, are making a significant contribution to the health of our country and its democracy.”
Relationships
Sars Commissioner Edward Kieswetter said that the revenue service is looking forward to working with this segment to provide clarity and certainty, but also to provide them with a seamless taxpayer experience.
Kieswetter said Sars is “more than willing to assist honest taxpayers” to comply with their tax obligations.
“I am reminding social influencers to uphold their end of the bargain.”
Sars said it aims to do much more in terms of outreach and education, and will also provide seminars and webinars as well as rulings to educate taxpayers about their obligations.
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