Small business VAT exemption for influencers and UGC creators

The small business scheme in Austria and Germany (Kleinunternehmerregelung) lets small businesses skip charging VAT as long as their revenue stays below a legal threshold. For many creators starting out, that’s a simplification – whether it fits you is something to clarify with the tax office or a tax advisor.

What the small business exemption is

As a rule, businesses add VAT to their services and pay it to the tax office. In Austria and Germany there’s an exception for small businesses: if revenue stays below a certain threshold, they don’t have to charge VAT. They’re then called Kleinunternehmer, or small businesses. Each country sets the threshold and the exact conditions, and they’re adjusted from time to time. So check the current value with the tax office, the Austrian Economic Chamber (Wirtschaftskammer) or the German Chamber of Commerce and Industry (IHK). The scheme only affects VAT – you still pay income tax on your profit.

VAT as a creator: what counts as revenue

To tell whether you stay below the threshold, your revenue counts, not your profit. That includes fees from collaborations, income from UGC, commissions from affiliate programs and sales of your own products. Products you get to keep in exchange for a post can also count as payment. If you work for companies abroad, partly separate rules apply to that revenue, such as the reverse charge procedure within the EU. So keep an eye on your revenue on an ongoing basis instead of only doing the math at year’s end – a single larger job can tip the balance.

Pros and cons for creators

The biggest advantage is simplicity: you don’t charge VAT, and your invoicing is easier to keep track of. For private customers your prices are also lower, because no tax is added. The downside: you can’t deduct input tax, meaning you can’t reclaim the VAT on your own expenses. Anyone who invests a lot in cameras, computers or software ends up paying more as a result. Since collaboration partners are usually businesses that can reclaim VAT anyway, the price advantage often matters less for creators. In many cases you can opt out of the scheme, but you’re then bound to that choice for some time.

When you exceed the threshold

If your revenue exceeds the threshold, the small business scheme ends, and from the relevant point in time you have to charge and pay VAT. Exactly when that applies depends on your country’s rules and has changed in recent years. If you notice too late, you may have to pay the tax retroactively without having received it from the client. That’s why it pays to talk to a tax advisor early when your revenue is growing and to switch your prices, invoicing and bookkeeping in good time, before things get tight.

Small business status on creatordeal

On creatordeal you enter your tax status during verification, for example whether you use the small business scheme. Your tax number is required. You need a VAT ID if you are not a small business or if you work for companies in other EU countries; it then appears on your credit note and is verified by us. As a small business without cross-border sales, it is optional. creatordeal settles through self-billing; the credit note follows the status you’ve entered – with VAT, with a note about the small business exemption or, if you are based outside Austria, with a note that the tax liability passes to creatordeal (reverse charge). If your status changes, update it right away; you bear the consequences of incorrect details. In addition, creatordeal is legally required (DAC7) to report your income to the tax office and needs your date of birth, tax number and country for that before the first payout.

What this article doesn’t replace

This article gives a general overview and is not tax advice. Whether the small business scheme applies to you follows from the law of your country. You can opt out of it and are then bound for several years; creatordeal does not decide on this. Thresholds, deadlines and special rules change and differ between Austria, Germany and other countries. Binding information comes from the tax office; the Wirtschaftskammer in Austria and the Chamber of Commerce and Industry (IHK) in Germany offer fact sheets and advice. For your personal planning, especially with clients abroad or fast-growing revenue, a tax advisor is the right person to talk to.

Questions

Frequently asked.

Key answers at a glance. Everything else is in the guides and in the FAQ.

Does the small business VAT exemption apply to influencers?

Yes, it can apply to influencers just like other self-employed people, as long as revenue stays below the legal threshold. Check the current value with the tax office.

Do I have to charge VAT as a creator?

As a rule yes, unless you use the small business scheme. For clients abroad, separate rules such as the reverse charge procedure can apply.

Do gifted products count as revenue?

Products you get to keep in exchange for a post can count. How to value them is something to clarify with your tax advisor.

Is the small business exemption worth it for UGC creators?

That depends on your expenses. It simplifies invoicing, but in return you can’t deduct input tax on equipment and software.

Where do I enter on creatordeal that I’m a small business?

In your tax details in the creator area. If you are based in Austria, credit notes are then issued with a note about the exemption; if you are based outside Austria, they state that the tax liability passes to creatordeal (reverse charge).

Enter your tax status once

On creatordeal every credit note follows the status you’ve entered – you don’t write your own invoice.

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