Tax Traps for Influencers and Content Creators – What the Tax Office Wants to Know

In recent years, the creator economy has grown rapidly: influencers, YouTubers, streamers, podcasters, and other content creators are now earning considerable income – which has drawn increasing attention from the German tax authorities. But what exactly are the tax obligations for digital creators? Which types of income are taxable, and where do common pitfalls lie?

This article provides an overview of the most important tax aspects for content creators – and how to avoid costly surprises.

1. Freelancer or Business? – How Influencers Are Classified

As a general rule: anyone who regularly earns money through online activities is considered to be engaged in entrepreneurial activity under German tax law. Most influencers are classified as traders ("Gewerbetreibende") and are therefore required to register a business.

Only in rare cases (e.g., journalistic content with an original creative character) might a classification as a freelancer ("Freiberufler") be possible – but this must be assessed on a case-by-case basis and is quite uncommon.

2. What Types of Income Are Taxable?

Influencers often generate income from a wide range of sources, including:

• Sponsored content and brand collaborations

• Affiliate links and commissions

• Ad revenue (e.g., via YouTube AdSense)

• Donations via platforms like Patreon, Twitch, or Steady

• Sales of own products or online courses

• Gifts (e.g., PR samples, free trips, or products)

Important: Non-cash benefits – such as gifts or sponsored travel – may also be considered taxable income, if they are linked to the influencer's business activities.

3. VAT: Small Business Regulation or Not?

If your revenue was below €25,000 in the previous year and is expected to stay below €100,000 in the current year, you can opt for the small business regulation (Kleinunternehmerregelung, § 19 UStG). This exempts you from charging and paying VAT.

Warning: Once you opt out or exceed the threshold, you are obligated to file VAT returns, which often catches growing influencers off guard.

4. Profit Determination and Tax Returns

Influencers are required to prepare an income surplus statement (Einnahmenüberschussrechnung, EÜR) each year and submit it along with their income tax return.

Depending on revenue, the following may also be required:

• Trade tax return

• VAT return

• Annex G (for income from business activities)

  
  

5. Key Risks and Common Mistakes

Many creators start "on the side" and underestimate their legal obligations. Typical mistakes include:

• Not registering with the tax office

• Incomplete or missing invoices

• Failure to declare non-cash benefits

• Mixing personal and business expenses

• Overlooking VAT obligations

Things can get especially serious if the tax office initiates an audit or receives information from third parties (e.g., agencies or business partners) about undeclared income.

6. Our Conclusion: Seek Advice Early

Getting started in the creator economy may seem easy – but tax compliance is not. Engaging a tax advisor or a law firm specialized in tax law early on can allow you to focus on what really matters: creating great content – without the stress of unexpected letters from the tax office.

If you have questions about tax obligations for influencers and digital entrepreneurs, feel free to contact us.