Tax Law and Affiliate Marketing in the UK If you’re working online in affiliate marketing, then you need to make sure you understand what your tax liabilities are. Tax is quite straight forward and hopefully below will give you a brief overview of what you need to know. Just because you earn money online as an affiliate, it doesn’t mean it’s “free money” that you don’t have to pay tax on. Being an affiliate is the same as anybody else who works for themselves, self-employed and working from home. When you are self-employed, there are two things you need to be aware of. The first is that you will be liable to pay tax on your profits, the second is that you will be liable to pay National Insurance contributions too. HMRC Firstly, you will have to register with Her Majesty’s Revenue and Customs (HMRC, that’s the Tax Office) to let them know you are now self-employed. HMRC are aware that a lot of people are now working online, in affiliate marketing, selling on eay, etc and even use a software programme called Xenon that performs multiple searches, connecting people together. E.g. in eBay Xenon will scan and find people who are making a lot of transactions; software and systems such as this will become ever-more commonplace in the coming years as they refine how it works and as more data is available online and electronically.
UK Tax and Affiliate Marketing