By in Business

Paying Tax on Writing Income

Do you have to pay tax on writing income earned on sites like Persona Paper?

However you earn money, it's income - and tax could be due to be paid on that income. As the writer it's your responsibility to check out the rules to find if you need to pay tax and how much tax you need to pay. As everybody's situation is different, there's no straight forward answer to the question of "Do I have to pay tax on my income from Persona Paper" (or any other writing site). The answer is: it is income and will be taxed as income.

Many people think it is "free money", not to be taxed - if it is your only income then you might not reach the threshold at which you pay tax, but that doesn't mean it's free money, it's just money that you personally don't have to pay tax on - but somebody else's situation will be different and they might have to pay tax on it.

So make sure you know your tax situation and whether you should be paying tax on your own income from writing on sites like Persona Paper, Hubpages, Bubblews, or any one of the other 100 similar sites. Anything from which you derive an income is potentially taxable and there's no escape!

C/0910/241/36


Image Credit » Image by Author: Photo of my money, taken with my camera.

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Comments

bestwriter wrote on January 19, 2015, 4:07 AM

It gets added to the total income of the year.

Shadi wrote on January 19, 2015, 4:35 AM

I don't think PayPal income is taxable as long as you don't withdraw it to your bank account.

UK_Writer wrote on January 19, 2015, 8:46 AM

It is taxable. It is taxable as it is income. The Govt are also in contact with Paypal, so they will know who receives money through Paypal.

UK_Writer wrote on January 19, 2015, 8:47 AM

For me, my writing is my only income at the moment - and I've not earnt enough to reach the tax free threshold so I won't be paying tax on mine emoticon :smile: Not sure whyy I'm smiling there, not paying tax means I'm a bit short of money all round!

bestwriter wrote on January 19, 2015, 8:54 AM

For me writing here is having relaxing moments and those coins give me joy just to listen to their jingling sound (lol).
If you are calling 'writing' your income that must be quite a bit (lol)

Shadi wrote on January 19, 2015, 8:56 AM

But I think with pennies or even few dollars they will turn a blind eye.

UK_Writer wrote on January 19, 2015, 9:01 AM

Ah, the last transfer I did from Paypal to my bank was about $5,000 - from my online work. It's not pennies or a few pounds.

Shadi wrote on January 19, 2015, 9:09 AM

Once I posted that question to someone who works in that field (we were having something like orientation course) and I asked about online earnings and whether or not they count in the taxing. She said it depends on the amount. Even up to 50 Euros would not be counted. That was in Belgium 4 years ago I don't know about other countries and if they are more strict now.

arthurchappell wrote on January 19, 2015, 9:41 AM

totally true - a great deal of money earned online goes undeclared

Hollyhocks100 wrote on January 19, 2015, 10:03 AM

IMO the tax man gets more than his fair share and I would never volunteer income gained from writing sites.

DWDavisRSL wrote on January 19, 2015, 11:13 AM

Income from writing on sites like PP are taxable as regular income in the US. Such earnings are probably also subject to self-employment tax (Social Security and Medicare) for which the threshold is much lower than for income tax. If you are on the cash basis (which most people are) the earnings becomes taxable income once it is in your PayPal account and you have control over where it goes from there.

DWDavisRSL wrote on January 19, 2015, 11:18 AM

What UK_Writer says holds true for the US as well. Once the money is in your PayPal account you have control over it and must include it in income. Also, depending on the amount you receive in a year, the site, PayPal, or both may be required to report the sum of the transactions.

MsBiz wrote on January 19, 2015, 11:44 AM

The good side of freelancing, at least in the US, is that you get a lot of good write-offs to offset the taxes. It is important to declare everything, though.

UK_Writer wrote on January 20, 2015, 9:13 AM

He's onto you though. It's a writer's responsibility to register as self-employed with HMRC within 3 months of starting. Then to do an annual tax return (whether a profit's made or not). And they are increasingly looking for people who haven't registered.
For those who are claiming Working Tax Credits (WTC), which I've refused to do as a matter of principle, from April 2015 to even claim them you need to provide your tax registration number on the form. Then they assume you're earning NMW for the hours you have to work anyway. It's been a cheater's loophole for the last X years, they're cutting it off.

UK_Writer wrote on January 20, 2015, 9:14 AM

In the UK, the amount you can offset against tax is variable, depending on how you're operating. But, mostly, it's minimal/non existant/not worth the effort.

UK_Writer wrote on January 20, 2015, 9:15 AM

Yes, Paypal is a bank account, like any other - and once the money's there it's yours, so potentially taxable.

UK_Writer wrote on January 20, 2015, 9:17 AM

I've earnt my income like this, for 8 years now. Wholly online. But, I had to take a couple of years out for caring duties, during which time my website became in disarray and the amounts to be earned dropped - and how one markets oneself changed. I am always playing catchup. But this is the year I get back to where I was.... hopefully.

UK_Writer wrote on January 20, 2015, 9:17 AM

I need more than 50 euros every day, just to keep the roof over my head and the electricity turned on!

UK_Writer wrote on January 20, 2015, 9:18 AM

Undeclared at the moment, but, for those who do that, it's about to stop. People should at least declare it, even if there's no tax to pay.

bestwriter wrote on January 20, 2015, 7:10 PM

I admire you for your patience as getting a place in online is no easy feat. emoticon :cool:

celticeagle wrote on January 21, 2015, 6:21 AM

I think you only have to if it is over a certain amount.

UK_Writer wrote on January 21, 2015, 7:29 AM

You only pay tax over a certain amount, but, certainly in the UK, you have to register yourself with tax authorities - simply submitting a return to show/prove you've not made enough income to be taxed on it. Also, in the UK, a lot of people might not realise that some of the benefits they receive are "taxable", so all those would need to be added up - and the total ascertained, to see if they'd need to be paying 20% tax on the writing.

celticeagle wrote on January 21, 2015, 1:43 PM

I see. Interesting.

mrsmerlin wrote on January 21, 2015, 3:11 PM

I have a list of earnings from here and of any vouchers from survey sites and hand it over at the end of the tax year to be added into the calculation. I would end up being the one to get caught anyway so I may as well do it the right way lol

UK_Writer wrote on January 21, 2015, 5:54 PM

It's better to suffer the pain of going through the process and paying any tax, than fearing every letter, phone call or knock at the door for the sake of paying a bit of tax :)