The content creators on X now earn money based on the reach of their posts on the platform. How revenue from X will be taxed? Check tax rules for X users here.
Elon Musk’s X, formerly known as Twitter, has recently started sharing its advertisement revenue with its premier subscribers and verified accounts. So, the content creators on X will now earn money based on the reach of their posts on this micro-blogging platform.
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There are several users who have already received their first payment; they broke the news by sharing the screenshots of their pay slips on social media. The taxation of such income has now become a concern for a majority of the content creators generating revenue on X. It is quite complicated and varies according to the tax laws of the jurisdiction.
Tax
According to tax experts, while social media revenues will be taxed, it will not be the same for all users regardless of whether the user is a professional or salaried person. If earning through content creation is the sole source of income for any individual, it would be considered business income and so, the taxation will be under the “Profits and Gains of Business or Profession” head.
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Meanwhile, for people whose social media engagement is just a part-time activity, their income would be taxed under the “income from other sources” head. How frequently a creator generates income from tweeting can have an impact on how he/she will be taxed. If the activity is one-time, there may be different tax implications than if it is a consistent source of income.
Balwant Jain, a tax and investment expert told Live Mint that the content would be analysed to decide under which head the taxation would fall. It means if someone needs any technical expertise to create his content, his activity on X would be treated as a profession.
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“If the contents of the tweet which you are sharing require you to have technical expertise for which special training is required, the same would be treated as a profession and provisions of section 44AD would apply,” Live Mint quoted Jain as saying.
Stripe account
X users must create a Stripe account in a bid to receive their income from the micro-blogging platform in their bank accounts. However, if they earn more than Rs 20 lakh in a financial year, the earnings must be registered under the GSL rules. The taxability would differ depending on whether Indians received their share of earnings from ‘X’ India or from any overseas branches.
