If Influencers are subject to unlimited income tax liability in Germany, their worldwide income is subject to income tax. This includes all additions of economic goods in the form of money or monetary value that accrue to the Influencer for his or her activity.
Benefits in kind or free services, such as branded products provided, free travel/hotel accommodation or even a free visit to the hairdresser, are also considered income and are generally subject to taxation.
This can also lead to unplanned income for tax purposes if, for example, a jeweler provides the Influencer with a diamond necklace free of charge for photo purposes. In this case, the necklace does not represent a gift, but is to be valued as a benefit for the services rendered by the Influencer.
For income tax purposes, non-cash benefits are only not to be taken into account if one of the following four conditions is met:
Return: If the Influencer sends the product back to the manufacturer without having used or consumed it beforehand, no economic benefit accrues to him/her. The same is to be assumed if the Influencer tests the product but then sends it back again, since no change of ownership has taken place and thus no pecuniary benefit has been obtained.
No consideration: If the Influencer does not provide any consideration for a benefit in kind, the benefit has not accrued to him in the course of his commercial activity and must be classified as a gift.
Promotional and promotional items: Items with a value of less than €10 are to be declared as promotional and giveaway items and are irrelevant for tax purposes. Ballpoint pens, calendars, etc. are to be considered here.
Flat-rate income tax for non-cash benefits: The donating company has the option of taxing the donated product at a flat rate of 30%. If such a flat rate is applied, the Influencer does not have to pay any additional income tax on the product received.
If you have any further questions, please contact social@reachbird.io.