People earning money through social media need to consider more than fees. Products, vouchers and other benefits may also have tax implications. Income tax, VAT and, where relevant, trade tax must be assessed separately. These ten misconceptions often lead to incorrect conclusions.
1. Only cash payments count as income
Content may be paid for with goods, travel, vouchers or other benefits. Whether a benefit constitutes business income, and its value, depends on the agreement and the specific benefit. Record what you received, the agreed services in return and whether you may keep or must return the product.
An additional benefit in kind may, subject to the requirements of § 37b EStG , be taxed at a flat rate by the company providing it. This does not automatically apply to every product received as payment. Obtain confirmation of any flat-rate tax actually paid on your behalf.
2. Turnover is the same as taxable profit
For income tax on a business activity, profit is the relevant figure. Business expenses may reduce profit unless a deduction is prohibited. Platform turnover, bank receipts and profit are therefore different amounts. Whether income tax arises also depends on your other income and personal tax circumstances.
3. Every creator is automatically a liberal professional
The label “creator” or “influencer” does not determine the category of income. Advertising activities are often commercial. Artistic, journalistic, literary or teaching activities may qualify as liberal professional activities under § 18 EStG . What matters is the activity actually carried out. Where there are several activities, their relationship must also be assessed.
4. Small businesses do not pay income tax
The small business rules under § 19 UStG concern VAT. They are not a general tax exemption. Profit may still be subject to income tax. Tax registration and other reporting obligations must be assessed separately.
5. The old turnover limits still apply
Since 2025, the domestic small business VAT exemption generally requires total turnover not to have exceeded EUR 25,000 in the preceding year and not to exceed EUR 100,000 in the current year. Official guidance applies a EUR 25,000 limit in the year the activity starts. The transaction that exceeds the applicable current-year limit is itself no longer exempt.
The relevant figure is total turnover for VAT purposes, rather than profit. Opting out of the exemption and cross-border situations also require attention. Details are explained in the official ELSTER guidance on the small business rules.
6. Everything featured in content is a business expense
A purchase does not become a business expense merely because it appears in a photo or video. The business purpose and statutory deduction rules are decisive. For mixed use, private and business shares must be assessed. Keep receipts and document the business purpose, particularly for equipment, travel and furnishings.
7. The gift limit applies to each individual item
For gifts to people who are not employees, section 4(5), sentence 1, no. 1 EStG sets a EUR 50 limit. The relevant figure is the aggregate acquisition or production cost of items given to each recipient in the financial year. This is a threshold, not an allowance for each gift. VAT issues and record-keeping duties require separate assessment.
This rule concerns the donor's expenses. It does not automatically determine whether a product received by a creator is tax-free.
8. A foreign client makes the income tax-free
For an individual subject to unlimited German income tax liability, income does not become exempt simply because a platform or client is abroad. VAT requires assessment of the type of service, the recipient and the place of supply, among other things. Invoice treatment therefore cannot be determined solely by the platform's location.
9. Every commercial business must prepare a balance sheet
A commercial activity does not always automatically require balance-sheet accounting. Where the statutory requirements are met, cash-basis accounting under section 4(3) EStG may be possible. The required method of determining profit must be clarified separately. Clear records and supporting documents remain important in all cases.
Record fees, commissions, platform statements and benefits in kind separately. Also document contracts, invoices, withheld fees and any tax paid on your behalf by a cooperation partner.
10. Simply reporting omitted income guarantees immunity from punishment
Anyone discovering an error should have the facts reviewed promptly. A duty to correct may arise under § 153 AO . A voluntary disclosure providing immunity from punishment under Section 371 AO has separate requirements, particularly completeness and timely payment. Statutory blocking grounds may exclude immunity. An audit already under way or proceedings already opened may be significant. Uncoordinated partial disclosures are therefore not a reliable approach.
What to gather for a review
- Contracts and statements from platforms and cooperation partners.
- An overview of cash payments, products, vouchers and other benefits.
- Invoices, expense receipts and evidence of business-use proportions.
- Tax returns already filed, assessments and letters from the tax authorities.
Together, we assess the tax classification and the next steps required. Find out more about my work under Tax law and Tax criminal law.
Legislation and sources
Relevant provisions include in particular sections 1, 4, 15, 18 and 37b EStG, § 19 UStG, the linked official ELSTER guidance and sections 153 and 371 AO. This information describes typical questions. The treatment of an individual case depends on the facts.