Free products and services that a content creator receives in return for promoting a brand are taxable income, valued at what they would have cost if you had paid for them. HMRC’s guidance says income from creating online content includes gifts and services received from promoting products online, and once total trading income for the tax year passes the £1,000 trading allowance you need to tell HMRC.

Are gifted products really taxable for influencers?

Yes, where they are received because of the creator work. HMRC’s guidance on income from online platforms lists making online videos, producing podcasts and social media influencing as creating online content, and states that income from creating online content includes gifts and services you receive from promoting products online. Its worked example describes a beauty reviewer who earns advertising income and also receives gifts from the companies whose products are reviewed, and says that person may need to tell HMRC about this income.

The legal basis is section 28A of the Income Tax (Trading and Other Income) Act 2005. Where a transaction involving money’s worth is entered into in the course of a trade, an amount equal to the value of the money’s worth is brought into account as a receipt if a receipt would have been recognised had the transaction involved money. HMRC’s Business Income Manual at BIM40051 explains that this put into statute the principle from Gold Coast Selection Trust Ltd v Humphrey, for transactions on or after 16 March 2016. In plain terms, a phone sent to a reviewer in exchange for a video is treated the same as cash paid for that video.

What about products sent with no strings attached?

This is the grey area. BIM41810 sets out case law signposts for voluntary receipts. Gifts are not taxable unless they can be attached to a pre existing source such as a vocation (Beynon v Thorpe). A trading relationship between payer and recipient is not necessary for a payment to be a trading receipt (CIR v Falkirk Ice Rink Ltd). What counts is the character of the receipt in the recipient’s hands, although the payer’s purpose is evidence of that character. Voluntary payments designed to augment the consideration for goods or services, past, present or future, are taxable.

A brand that sends unsolicited products to a creator is almost always hoping for coverage, and the item reaches the creator because of the channel. On the BIM41810 signposts that points towards a taxable receipt of the creator’s trade, even where nothing is formally required. BIM41810 also accepts that a gift from a close relative can normally be treated as coming by virtue of the personal relationship, so genuine personal gifts from family are a different matter. Where a case is borderline, keep the covering email or note that came with the item, because it is the best evidence of why it was sent.

How do you value gifted products and services?

HMRC’s online platforms guidance says that if you received gifts or services instead of money, you use the value of what it would have cost if you had to pay for them. Section 28A uses the value of the money’s worth. In practice that means:

  • using the price a customer would pay for the item or service at the time it was received, not a later resale price;
  • valuing hotel stays, meals, travel and experiences provided in return for content at their normal price to a paying customer;
  • keeping a log of each item, the date, the brand, what was agreed and the value used, with screenshots of the retail price.

BIM40051 notes that, following Tennant v Smith, something that is not money and cannot be turned into money is not a receipt of a trade, using the example of a non transferable holiday given to a trader as a reward for being a good customer. That reasoning concerns rewards for custom, not payment in kind for promotional services, so it should not be relied on to exclude items given in exchange for content.

When do you need to tell HMRC?

HMRC’s guidance says income from creating online content must be added to income from other trading activities, such as selling goods or providing services, and if the total is more than the £1,000 trading allowance for the tax year (6 April to 5 April) you need to tell HMRC. The trading allowance is in sections 783A to 783AR of the 2005 Act, as BIM86000 explains. If gross trading income is £1,000 or less, full relief means it is not taxed and you may not need to tell HMRC. Above that, you can either deduct the £1,000 allowance instead of actual expenses (partial relief) or deduct your actual expenses in the normal way.

Gross income includes the value of gifted products, not just cash. HMRC’s trading allowance guidance also says the allowances cannot be used for income from your employer or your spouse’s employer, or from a company or partnership you or someone connected to you controls or is a partner in.

If you need to file a return for 2025 to 2026 and have not sent one before, or did not need to send one for 2024 to 2025, gov.uk says you must register for Self Assessment by 5 October 2026 and that telling HMRC later could lead to a penalty.

Will HMRC know about gifted income?

HMRC’s online platforms guidance says that operators of digital platforms may need to collect and check specific details about sellers and report them to HMRC. The rules are covered in digital platform reporting. Keep records that let you reconcile declared income, including gifted items, to the sponsored content visible on your channels. If HMRC does write about undeclared platform income, see HMRC nudge letters for how those letters work.

Does VAT apply to gifted products?

VAT is a separate tax with its own threshold. You must register if taxable turnover for the last 12 months goes over £90,000 or you expect it to go over £90,000 in the next 30 days, and you can register voluntarily below that level. Creators with substantial brand deals should track turnover month by month against the VAT registration threshold and take advice on how payment in kind is treated before they get close to it.

A worked example

Illustration only. Mia runs a cookery channel. In 2026 to 2027 she receives:

Item Value
Cash for two sponsored videos £600
Stand mixer sent in return for a review video (normal retail price) £450
Two night hotel stay provided in return for posts (normal room rate) £300
Birthday present from her sister Not income

Her gross trading income is £1,350, which is over the £1,000 trading allowance, so she must tell HMRC. If her expenses are small she can claim partial relief and be taxed on £350. If her equipment and editing costs are larger, she can deduct actual expenses instead. The gift from her sister is a personal gift and not part of her trade.

What mistakes do creators make with gifted income?

  • Counting only cash and ignoring products, stays and services received for content.
  • Valuing items at what they might fetch second hand rather than what they would have cost to buy.
  • Applying the £1,000 allowance to cash alone and missing that gifted items pushed income over it.
  • Missing the 5 October registration deadline in the first year income goes over the allowance.
  • Keeping no record of what was agreed with each brand, which makes borderline items hard to defend.

Creators whose work is mainly writing, music or other original works should also read about royalties for authors and creators.

If HMRC opens a check into your return, tax investigation insurance pays your accountant’s fees. Solar Protect cover pays up to £100,000 with no excess; it never pays tax, interest or penalties. Read how our cover works or get a quote.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.