Influencers and Gifted Products: Is That Freebie Taxable?

A box of skincare lands on your doorstep. A brand sends you a new pair of trainers. A hotel offers you a free weekend in return for a few posts. It feels like one of the perks of the job, and nobody has handed you any money.

HMRC sees it differently. Its guidance for content creators is clear that income "includes gifts and services you receive from promoting products online". If you are getting products in return for content, their value can be taxable in the same way as a cash payment.

Below I explain when gifted products count as income, how to put a value on them, and what to do if you haven't been declaring them.

1. Are you running a business?

The starting point is whether your content creation is a trade. Posting for fun, with the odd freebie turning up unasked, is a hobby. Working with brands in return for payment or products starts to look like a business.

HMRC generally treats content creators who are paid in cash or kind by brands as trading. Signs that you have crossed the line include:

• agreeing deals with brands, directly or through an agency or platform

• being expected to post, tag or review in return for what you receive

• having a media kit, rate card or business account

• earning regularly, rather than once or twice

Once you are trading, everything you receive for that work counts towards your income, whether it arrives as money, products, services or experiences.

2. When does a gifted product count as income?

The key question is whether you received the item because of your content. If a brand sends you something in exchange for promoting it, its value is part of your trading income.

Some common situations:

• Gifted in return for a post, review or tag. Taxable. This is payment in kind, even if nothing is written down.

• Trips, meals and experiences. Taxable on the same basis if they are given in return for content.

• Items you must send back. Generally not income, because you don't get to keep them. Keep the brand's instructions as evidence.

• Unsolicited PR packages with no strings attached. This is the grey area. If there is truly no expectation of content and you don't feature the item, there is a reasonable argument it isn't income. But if you post about it, or brands send you things because of your profile and following, HMRC is likely to see it as connected to your business.

• Gifts from friends and family. Not income. A birthday present is still a birthday present.

If in doubt, keep a note of what you received, who from and why. That record makes it much easier to decide what to include later.

3. How do you put a value on a freebie?

A gifted item is valued at what it is worth in money, which is usually the price you would have had to pay for it. For most products, that is the normal retail price at the time you received it.

A few practical points:

• Use a sensible, provable figure. A screenshot of the product page on the day you received it is good evidence.

• Don't use an inflated figure. An "RRP" that nobody actually pays is not the right value if the item is widely sold for less.

• Experiences count too. A hotel stay or meal is valued at what a paying guest would have been charged.

• Keep a simple log. Date, brand, item, value, and what you agreed to do in return. A spreadsheet is fine.

HMRC's own example shows how it adds up. A creator with £700 of paid sponsorships, £300 of gifted products and £200 of ad revenue has £1,200 of income, which is over the £1,000 limit.

4. The £1,000 trading allowance

The first £1,000 of trading income each tax year (6 April to 5 April) is tax-free. If your total income from all trading activities, including the value of gifts, is £1,000 or less, you don't need to tell HMRC about it.

Two things catch people out:

• The £1,000 is gross income, not profit. It is measured before any expenses.

• It covers all your trading income combined. Brand deals, gifted products, ad revenue, affiliate commission and any other side income all count together.

If you go over £1,000, you need to register for Self Assessment as a sole trader by 5 October after the end of the tax year. For income received in 2025/26, that deadline is 5 October 2026. The online return and any tax due then follow on 31 January.

If your income is over £1,000, you can choose either to deduct the £1,000 allowance or to deduct your actual expenses, whichever gives the better result. You can't do both.

5. What expenses can you claim?

You pay tax on your profit, so business costs reduce your bill. Expenses must be incurred wholly and exclusively for your content business. Typical claims include:

• cameras, lighting, microphones and editing equipment

• editing software, apps and subscriptions used for your content

• a proportion of your phone and broadband costs

• agency or management fees

• travel to shoots and brand events (not your normal commute)

• props bought purely for content

• a proportion of household costs if you work from home

The tricky area for influencers is anything with a personal use. Clothes, make-up, haircuts and gym membership are usually not allowable, even if you wear or use them on camera. The courts have long held that everyday clothing always has a personal purpose, because it keeps you warm and decent. The exception is items that are purely costumes or props and would not be used outside your content.

If you have been taxed on a gifted item and then use it wholly for your business (for example, a ring light), you may be able to claim it as a business asset.

6. VAT: gifts count towards the threshold

Most smaller creators won't need to think about VAT. But as your business grows, remember that products received in exchange for content are treated as payment for your services. Their value counts towards your VAT turnover alongside your cash fees.

You must register for VAT if your taxable turnover goes over the registration threshold (currently £90,000) in any rolling 12-month period, not just the tax year. Creators with a lot of high-value gifted products can reach this sooner than they expect.

Once you are VAT registered, a barter deal (content in exchange for goods) is a supply by you, and you may need to account for VAT on the value of what you received.

7. Haven't declared your gifts? How to put it right

Many creators simply didn't know gifted products were taxable. If that's you, the best time to fix it is before HMRC contacts you.

HMRC is paying close attention to this sector. It has published research on social media content creators, runs a dedicated "tax help for hustles" campaign, and online platforms now report sellers' details to it.

If you owe tax for earlier years, you can tell HMRC through its Digital Disclosure Service. Penalties are much lower when you come forward voluntarily than when HMRC finds the income first, and in some cases can be nil. Interest will still be charged on late tax.

If you're already in Self Assessment, you can usually amend a return within 12 months of the 31 January filing deadline. Older years are corrected through a disclosure.

In summary

• Products, trips and experiences you receive in return for content are income, just like cash.

• Value them at what you would have paid, and keep a simple log with evidence.

• The £1,000 trading allowance covers all your trading income combined, including gifts.

• Over £1,000? Register for Self Assessment by 5 October after the tax year ends.

• Claim genuine business expenses, but everyday clothes and beauty products usually won't qualify.

• Gifts count towards the VAT threshold too.

• If you've missed something, coming forward before HMRC asks keeps penalties down.

This is general guidance rather than advice on your particular situation, and the rules have specific exceptions. If you would like us to check how your own-use figure is being calculated, or to look at whether the cash basis suits your business, please get in touch.