Observers and industry players told CNA the new guidelines will make the influencer ecosystem more transparent and accountable, and protect content creators from clients who do not offer fair remuneration by encouraging cash payments instead of just gifts.
But they raised concerns that the guidelines will put more burden on smaller creators who are more likely to accept free products and services instead of cash as payment for the jobs they have completed.
They also raised questions about public relations (PR) gifts received not as part of an official job, products or services featured as an unpaid favour, and whether influencers should declare retrospectively for the upcoming tax season.
In Malaysia, tax returns of individuals with no business income are required to be filed by Apr 30 of the following year. As for those who are carrying on business, the deadline for filing the tax returns is Jun 30 of the following year.
Zul Rafique & Partners said smaller creators face a “heavier compliance burden” as opposed to larger influencers who typically command fixed cash fees and have established accounting systems.
“(Smaller creators) must now determine the market value of items received, keep detailed records, and potentially pay tax on benefits received in kind, even when no cash changes hands,” they said.
“For creators with modest or irregular earnings, this can raise cashflow concerns and increase compliance anxiety, especially where guidance on valuation and record-keeping is not fully clear.”
INFLUENCERS ASK FOR CLARITY
A full-time content creator who only gave her name as Ainaa, 31, said the job is not just about recording videos. Rather, it involves time, effort, equipment, content planning, and ongoing operational costs.
“So, any changes to guidelines naturally require some adjustment in terms of additional administrative work, such as keeping more detailed records of collaborations and assessing the value of goods or services received,” she told CNA.
“For content creators, this could potentially increase operational costs, whether in terms of time or the need to seek accounting assistance. However, I see this as a step towards more professional management in the long run.”
Ainaa, who has about 36,500 followers on Instagram under the handle @n.ainaafiqahh, called for smaller creators to be given “clear guidance and support” with the new guidelines to help them continue to grow in a more professional and sustainable manner.
Fellow full-time content creator Dharshamini Kesavan said the new tax guidelines will make content creators more responsible and protect them from clients who have “no budget, but only (want to deal in a) product or services exchange scenario”.
“Honestly, there’s no big difference for me … Since I became a full-time content creator (in 2023), I have kept filing my taxes. For me it’s business as usual, except declaring the gifts and services,” the 37-year-old told CNA.
However, Dharshamini noted that since the COVID-19 pandemic, she has helped small businesses promote their products or services for free as part of her corporate social responsibility. She wonders if the gifts she gets under this initiative need to be declared too.
“How do we differentiate a genuine support post for family and friends by a content creator?” she asked.
Another scenario that raises questions, Dharshamini said, is when influencers are paid to create content for business like spas, restaurants or hotels, where they have to experience the services offered at these places.
“I will be declaring tax for the remuneration I receive. How about the services? For me it’s part of the requirement for the job delivery. Should I declare (the value of the services) as well?”
Dharshamini, who has more than 79,000 followers on Instagram under the handle @dharshamini_kesavan, feels LHDN should give clearer guidelines and further educate creators on the dos and don’ts, such as if there will be a minimum threshold for products or services to be declared.
“Once we have clear, binary guidelines, it’s going to be easier for everyone,” she added.
https://www.channelnewsasia.com/asia/malaysia-influencer-tax-gift-lhdn-social-media-content-creator-5896086
