Tax Returns for Streamers
Many streamers start as a hobby, often born from dreams to share a love of gaming with others. But what happens when that hobby becomes a side income or even something larger? When do streamers have to declare their income? How do streamers pay tax? And what about the compliance and paperwork?
No matter how new at streaming you are, Ocelot is here to help. We’re specialists in accounting for streamers and know a thing or two about how best to manage your income. Keep reading for expert advice covering everything you need to know about paying taxes as a streamer.
When Does a Streamer Need to Submit a Tax Return?
When asking how to do taxes as a streamer, total revenue earned is the first thing to consider. When looking at your streaming income, you’ll need to sum up earnings from all sources. For instance, this could include Twitch, YouTube, Patreon, PayPal Donations, and merch, as well as any combination of the above.
Second, you’ll need to keep in mind that each tax year runs from 6th April to 5th April over a 12-month period.
With these two fundamentals to hand, we can start to look into whether you’ll require a tax return as a streamer for that particular year!
What If You Earn Over £1,000 in Streaming Income?
If you’ve earned over £1,000 from streaming in the past 12 months, there’s a legal requirement to register as self-employed in order to declare your earnings to HMRC. You can claim back allowable expenditure against your streamer earnings, with the net amount (your profit) being subject to tax.
The UK tax system is particularly complex when it comes to such matters, as you’ll need to take into account any other employment and taxes paid. This is where our specialist accountants for streamers come into play!
With Ocelot managing your streaming taxes, we can typically help you save more tax than what we cost in fees. This is down to our experience and knowledge of the expenses you can claim to reduce your tax bills. In an ideal scenario, we can reduce your tax liability to a minimum or even generate a tax refund.
If you’re earning over £1,000 a year through streaming income, get in contact with us today to learn how we can save you money!
What If You Earn Under £1,000 in Streaming Income?
If you expect to earn less than £1,000 over the year from streaming – likely to be the case if you’re just starting out – then there is good news: you’re not legally obliged to register as self-employed! However, you may still want to consider submitting tax returns for potential tax refunds.
HMRC allow for losses to be relieved against other forms of income, subject to certain accounting principles. On assumption that most new streamers can claim heavy expenses in their first year, it is assumed that you’ll likely be running a loss of say £2,000-£5,000. If you have other employment and pay taxes, this could result in a tax refund of £400-£1,000.
These can be ongoing refunds each year a loss is incurred. Lovely!
Already Registered as a Self-Employed Streamer?
Perhaps you’re already familiar with the above two scenarios and are having a whale of time growing your streaming hobby into a full-time income stream – kudos to you if so!
You may well be ready to go the next step and set up as a Limited Company, with the potential tax benefits being even greater. Once you reach this level, the sky really is the limit with how much in tax you can save. This is a specialist field we are particularly passionate about, so make sure you fire any questions our way for free advice on how to manage your streamer taxes.
Feel free to contact us today if you’d like to discuss your streamer income and earnings further. Even if you’ve just started out, it’s best to plan ahead. And remember, we don’t just offer accounting for streamers. We also offer specialist services for a wide range of content creators. Check out our services page for more detail.