Social media influencers and digital content creators have become some of the highest-earning individuals in today’s economy, leveraging brand deals, sponsorships, and digital platforms to generate substantial income. From luxury brand collaborations to big-money endorsement deals, the influencer industry has grown into a powerhouse. However, with this success comes increased scrutiny—especially from tax authorities. Now, the Income Tax Bill, 2025 has proposed to bring influencers firmly under the tax net. 

Freebies, barter deals, and social media earnings will no longer go unnoticed, and influencers will be required to disclose and pay taxes on their income just like any other business. “The Income Tax Bill, 2025 does not explicitly mention ‘influencers’ or ‘brand partnerships,’ as far as direct tax is concerned, but its provisions could have a significant impact on digital content creators based on general tax principles and interpretations,” Siddharth Chandrashekhar, advocate and counsel, Bombay High Court and panel counsel for CBIC & CBDT, told BrandWagon Online.

Here’s how the new tax rules will impact influencers and digital creators:

GST registration for influencers

“Persons engaged in digital content creation, including social media influencers and online platforms, shall be required to register for Goods and Services Tax (GST) if their turnover exceeds Rs 20 lakh in a financial year (Rs 10 lakh for special category states),” the new income tax bill proposes.

10% TDS on partnerships worth over Rs 30,000

Influencers receiving luxury goods, gadgets, or holidays as part of brand deals may be taxed on their fair market value, even if no money changes hands. If the value exceeds a certain threshold, it will be considered taxable income. “Brand collaborations involving barter deals may be taxed at their fair market value as taxable income. The only thing truly ‘free’ is a tax audit if influencers ignore providing full disclosure.” Chandrashekhar added. 

As per Section 194J, any payment exceeding Rs 30,000 in a financial year for professional services—including brand sponsorships—will be subject to a 10% tax deducted at source (TDS). This means brands must deduct tax before making payments.

Influencer income classified as business income

Earnings from brand collaborations, social media promotions, and digital content creation will likely be treated as profits and gains of business or profession (PGBP). This means influencers can claim deductions on expenses, but their income will be subject to taxation. “The Income tax Bill seeks to consolidate and simplify the provisions relating to income tax. Before the introduction of section 194R under the extant law, the value of perquisites and freebies went unnoticed leaving to discrepancies in reporting of income by influencers. While, influencers, are not specifically levied tax, similar to the Income-tax Act, the provisions of Income-tax Bill seek a levy of 10% TDS on monetary value of barter deals, freebies, or any perquisite in cash or kind. This would broaden the tax net to include in kind gifts viz foreign trips, mobiles given in exchange for brand promotion by influencers, paving way for better reporting and income disclosure,” Ankit Namdeo, managing partner, ANK Advisors, stated.

30% tax on crypto and NFT payments

The bill references “virtual digital space,” which includes social media platforms. Influencers receiving cryptocurrency or NFTs as payment will be taxed at 30%, with no deductions except for the cost of acquisition. “Influencers might be shaping trends, but the taxman is shaping their balance sheets,” Chandrashekhar commented.

With these new provisions, influencers must ensure full compliance with tax laws to avoid scrutiny.