Bloggers and social media influencers have been dominating various industries over the past years. Although many of these professions are relatively new, they paved the way for more job opportunities. If you’re a blogger or a social media influencer, know that it’s not all about your Instagram feed, the number of followers and likes you have, and the sponsors you need to think about. You also need to think about your tax deductions.
Since this is a new profession, there’s little information about the taxes of bloggers and influencers from the Australian Tax Office (ATO). This is where you should take a proactive approach and be more responsible for applying existing tax law to the types of expenses that you incur.
Keep in mind that you need to be blogging as a business, instead of a mere hobby. What this essentially means is that you should be gaining regularly from your blogging through sponsors, subscriptions, and whatnot. When you’re operating as a business, you can claim tax deductions for the costs you incur as part of your blogging, such as:
1. Internet Usage
You can file a claim for any Internet-related expenses to maintain your blog, such as hosting, registration, and blogging software fees. For your Internet plan, you can claim a portion of it if you run the business from your home. On the other hand, if you work from a dedicated office, you can claim the full cost of your Internet connection.
Bloggers typically need several pieces of equipment to run their business, such as a computer, cameras, lights stands, and microphones, among others. If you’re a self-employed blogger until 30 June 2019, you can claim an immediate tax deduction for any business-related item of capital equipment that costs less than $20,000. From 1 July 2019, the cost threshold falls to $1,000 per item.
3. Office Expenses
Whether you run your business from an office or your home, you can still claim a part of the rent or mortgage interest on your home as a tax deduction. It’s also possible to deduct a portion of your household bills for the space you use for your business!
On the other hand, for office equipment, you can use the $20,000 instant asset write-off to claim items of office furniture. Also, all the items of stationery and consumables at the office for your blogging are claimable for a tax deduction.
4. Communications-Related Expenses
Bloggers and influencers may claim tax deductions for business-related communications expenses, such as mobile phone calls. This is usually to cover their costs when collaborating with other influencers or companies as they plan new projects.
5. Advertising and Design Costs
Investing in good design and promotion is part of a blogger’s life. They help expand your business through effective designs and marketing efforts, especially if you’re trying to promote the services of another company. For this reason, you can claim any related costs to branding, such as advertising, logo design, or blog design.
6. Additional Expenses
There are expenses that you can claim for a tax deduction that fall under “other expenses.” For one, you can claim the cost of hiring an accountant. An accountant will also make sure that your books are kept in order, especially during tax season.
Just because you’re a blogger or an influencer doesn’t mean you should put your taxes at the back burner. Merely creating photos and videos are now considered as a serious business, meaning that you won’t want to get into trouble with the law. With that, it’s advisable you get an accountant for your online business so that you are always updated on the latest rules and obligations that you need to comply with as a small business.
Do you need professional help with your tax deductions? We have reliable accountants for online business in Australia who have experience with bloggers and influencers. Get in touch with us today to see how we can help!