As part of the UK’s 2016 Budget, Chancellor George Osborne has announced tax breaks for online “micro-entrepreneurs”.
A tax-free allowance of £1,000 will be available for people selling goods or services online, including earnings on platforms like eBay, Etsy and TaskRabbit. YouTube content creators will also benefit from this when selling merchandise and other products online.
“The rapid growth of the digital and sharing economy means it is becoming easier for more and more people to become ‘micro-entrepreneurs’,” the Budget document states. “However, for those making only small amounts of income from trading or property, the current tax rules can seem daunting or complex.”
Under the new rules, people who earn under £1,000 from this mode of trading won’t need to pay any tax on the income. Those earning over that amount will be able to simply deduct the allowance, rather than calculating their exact expenses. This means that YouTubers who are selling their products online will be entitled to £1,000 of tax-free income a year through this revenue stream.
Another £1,000 allowance is being provided for people who rent their homes on platforms, such as Airbnb.
The changes have been described as the world’s first tax breaks for people earning in the “sharing economy”, the peer-to-peer-based sharing of goods and services. Osborne referred to the allowances as “a tax break for the digital age”.
The allowances will be publicly implemented as of April 2017. The full Budget 2016 document is available to read via the government’s website.
We attended Glamour Beauty Festival’s ‘Beauty x Social Media’ panel, which featured Jim Chapman, Fleur DeForce and Estée Lalonde. Alternatively, you can find out which female YouTubers were named Change Ambassadors for the UN.
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