BIR issued a memo to remind social media influencers of their tax obligations.
BIR MEMO — On Monday, the Bureau of Internal Revenue (BIR) had issued a memorandum to remind social media influencers of their tax obligations.
Signed by BIR Commissioner Caesar Dulay, the Revenue Memorandum Circular No. 97-2021 was issued in order to inform social media influencers of their tax obligations and the possible consequences for not paying their taxes.
The memorandum stated that there were reports that they weren’t registered with the BIR or were registered under different tax types or line of business but were also not declaring from social media platforms for tax purposes.
“Whatever may be the reasons, it is now the most opportune time to discuss the tax obligations of these social media influencers,” said the BIR.
The Bureau of Internal Revenue defined “social media influencers” as those generating income for services as video bloggers (vloggers) and bloggers on social media sites such as Facebook, Instagram, Twitter, Reddit, YouTube, TikTok, and Snapchat, among others.
According to the BIR, social media influencers were classified for tax purposes as self-employed persons engaged in business or trade as sole proprietors. Social media influencers were also liable for income tax and percentage or VAT (value added tax).
Furthermore, the BIR cited Section 23 of the National Internal Revenue Code of 1997, which indicated that “citizens of the Philippines residing therein and domestic corporations shall be taxable on all income derived from sources within and without the Philippines“.
The BIR said that online content creators were also liable for business tax apart from income tax.
Meanwhile, social media influencers were allowed to deduct all ordinary and necessary expenses paid during the taxable year — including development, operation, management, and conduct of the trade, business, or exercise of profession.
For more information about the said memorandum, you can visit this link.