South African content creators have raised concerns over what they describe as an “unfair and unrealistic” approach by the South African Revenue Service (SARS) to tax income earned by social media influencers and digital creators.
The backlash comes after SARS in August announced that creators generating income through sponsored posts, brand partnerships, digital services, affiliate links and advertising revenue would be expected to declare all earnings − including payments received via international platforms such as YouTube, TikTok, Instagram and X.
In September, SARS issued another warning, calling on social media influencers to declare their earnings, reiterating that “income earned digitally is still income”.
The tax authority explained at the time that it is expanding its taxpayer segmentation model, which already covers standard taxpayers, large businesses, high-wealth individuals, public benefit organisations, estates and employers.
The latest additions to this segmentation model are national and provincial government, the gig economy and social influencers, described as “modern entrepreneurs” in a statement issued by SARS.
As such, influencers and content creators also have an obligation to pay tax, noted the revenue service.
This has prompted a wave of frustration among influencers, who say they are already battling inconsistent earnings, late payments from brands and rising production costs.
Elliot Joseph, a Johannesburg-based micro influencer, tells ITWeb that SARS is applying traditional tax rules to a rapidly-evolving industry that operates with irregular income streams and little structural support.
“Taxing income earned by social media influencers is fair in principle, but it’s unfair in practice if SARS doesn’t consider the real value of goods received, our remuneration structure and differences between small and big creators,” notes Joseph.
“Creators who only receive occasional gifts or small payments, for example, or micro-influencers who get PR packages but don’t have formal contracts or steady income, shouldn’t be taxed the same way as full-time influencers. Their content is often more of a hobby than a business, and taxing them could discourage creativity and growth in the industry.”
While Joseph is of the view that paying tax shows clients that a creator’s brand operates legitimately and responsibly, and this helps build trust with clients, he questions the approach SARS will take to apply tax on products received.
“Not every creator is earning big money. Some receive a few brand gifts or small deals that barely cover their content production costs. If SARS taxes everyone the same way, smaller or up-and-coming creators might end up worse off than established influencers, which could discourage young people from entering the industry.”
The upside of the taxation clampdown, he points out, is that it will influence many small creators to formally register their business (as a sole proprietor or private company) which will likely provide them with work credibility. “This could lead to brands, agencies and sponsors taking us more seriously, when we can invoice them properly and see that we operate like a legitimate enterprise not just a casual hobbyist.”
The country is seeing a surge in influencers, driven by expanding digital connectivity and the rise of platforms such as Instagram, TikTok and YouTube.
Brands are increasingly turning to influencer marketing as a cost-effective way to reach targeted audiences, boosting the size and visibility of the sector.
According to a report by Grand View Research, the digital content creation market in SA generated $450 million (R7.68 billion) in 2023, with a forecast of $1.058 million (R18.08 billion) by 2030, growing at a CAGR of 13.1% from 2024 to 2030.
For many creators, the reality of paying tax is a difficult adjustment.
A lifestyle micro influencer with over 25 000 followers on Instagram, who does not want to be named, says the new regulations are a “wake-up call”.
“I never really thought about the value of the gifts or brand deals I receive until I realised SARS counts them as income. It’s frustrating, but I understand why it’s necessary. I just hope there’s enough guidance to help creators like me get it right without risking penalties,” says the influencer.
She also claims that the guidance from SARS remains unclear, especially around how to declare non-cash benefits, such as gifted products, travel, or sponsored experiences.
“Most of us don’t earn stable monthly incomes but we earn in sponsored products or trips. How will SARS calculate the true value of these? Some months we make nothing at all. To treat us like established businesses when we’re still trying to build careers feels completely out of touch.”
She warns that strict taxation could result in some creators opting to enter other industries, while discouraging others from entering the industry − which is one of the country’s fastest-growing creative sectors.
“Creators bring global visibility to South Africa and generate jobs across production, photography and marketing. Government should be supporting the ecosystem, not punishing it.”
Reasonable action
Lerato Ntwampe, a social media legal consultant and an admitted attorney of the High Court, says the move to tax creators on both cash and non-cash income is justified.
According to Ntwampe, influencers and content creators − many of whom now earn a full-time income through digital platforms – should be treated as freelancers/independent contractors.
“Over the past few years, the influencing and content creation industry has grown significantly, with some creators even leaving their corporate jobs to pursue it full time,” Ntwampe notes.
“In that context, it is fair for SARS to tax income received in cash, brand exchanges or services. All records of campaigns and benefits received should be declared to avoid penalties or lifestyle audits.”
She adds that a lack of financial literacy, particularly around tax obligations, remains a challenge across the influencer and broader freelance economy.
“Unfortunately, many only realise their obligations when it is too late. The taxman is always watching – even on Instagram.”
One of the key enforcement challenges lies in monitoring short-form and temporary content. Ntwampe points out that many influencer campaigns are delivered exclusively through social media stories that disappear after 24 hours.
“This makes monitoring difficult without constant surveillance. Looking to international approaches, SARS is likely to rely more heavily on third-party data from banks and brands, as well as advanced analytics, to identify mismatches between declared income and visible lifestyles.”
Ntwampe does not believe certain categories of influencers should be exempt from taxation. Instead, she argues that tax liability should be based on income generation rather than follower count or platform category.
“Some creators with a few thousand followers can earn more than those with much larger audiences. It depends on the work they do and the brands they collaborate with,” she explains.
To support compliance, Ntwampe believes SARS should complement enforcement with education through targeted financial literacy initiatives.
A SARS spokesperson tells ITWeb that SARS generally calculates the market value of non-cash goods, in order to determine their rand value.
“Section 1 of the Incomes Tax Act defines gross income in relation to any year or period of assessment, means (i) in the case of any resident, the total amount in cash or otherwise, received by, or accrued or in favour of such resident. Any form of payment by law attracts tax payment.”
Share