With over 400 hours of content uploaded every minute, YouTube comprises a massive entertainment platform. The site has over 1 billion monthly users, with a continual demand for quality online content across a diverse range of subjects.
Armies of users produce and upload videos, aiming to earn the most views, leading to opportunities to make money. Income can be generated from various sources, such as:
- Advertising revenue (e.g. Google's AdSense campaigns);
- Affiliate and sponsorship income (paid for promotion of products or companies); and
- Paid content (where a fee is required in order to see the content).
The IRD has recently provided guidance regarding the taxable nature of such income, which is based on ordinary tax concepts. The key considerations are whether the individual is intending to make a profit, or is engaged in a 'scheme or undertaking to make a profit'.
So, if you receive YouTube income you may need to include this in your income tax return, even if you did not intend to profit. If you are receiving amounts regularly or are relying on the amounts as a form of income, the income is likely to be taxable.
Think ahead to IRD requesting a list of NZ members that have received payments from YouTube over $XXXX ….