Philippines services
Does your PH business engage social media influencers? Are you an influencer yourself? Either way – this article on tax and compliance obligations in the Philippines is for you!
If your business engages social media influencers for marketing campaigns, tax compliance isn’t just their responsibility—it’s yours too. Companies working with influencers in the Philippines must ensure they meet BIR regulations to avoid penalties and unexpected tax liabilities.
What does this mean for businesses that collaborate with social media influencers? In PART 1 of this article, we look at the various tax compliance obligations that arise for companies in the Philippines when engaging an influencer for their social media and marketing campaigns.
In PART 2, we review the BIR’s Revenue Memorandum Circular (RMC) No. 97-2021 and identify the key compliance takeaways that social media influencers must consider when running their own business.
Before diving in, let’s define what a “social media influencer” means from a tax and compliance perspective in the Philippines.
Are there taxes on social media marketing? Social media influencers, in the Philippines and across the world, have become a valuable part of many advertising and marketing campaigns run by companies, brands, and agencies. The Bureau of Internal Revenue (BIR) recognizes social media influencer marketing as a legitimate business activity:
Social media influencer marketing is a service from which many companies in the Philippines benefit greatly and it is a service that many influencers provide as their core business offering. With the rapid growth of digital content creation, the agency has identified several concerns and tax compliance mistakes that led to stricter taxes for social media influencers.
In RMC No. 97-2021, the BIR outlined and clarified the specific tax obligations of social media influencers in the Philippines, particularly when earning income directly from social media platforms (YouTube, Instagram, etc). With these measures, influencers—whether individuals or corporations—must register and fulfill their tax obligations. [1][2][3]
For Revenue Memorandum Circular No. 97-2021, the BIR defines a “social media influencer” as including:
Social media influencers can and do generate income in a variety of ways. The sources of income generation may be across both offline and online channels for the influencer, including both traditional marketing platforms and more modern marketing and branding campaigns. Influencers other than corporations and partnerships are classified as self-employed individuals or sole proprietors, thus their income is also considered business income.
Below are just two of the more common ways by which social media influencers might generate income:
So, do YouTubers have to pay taxes in the Philippines? The answer is yes; the BIR lists several sources for revenue generation, including:
Businesses typically partner with influencers in two ways:
1. Engaging a Social Media Influencer Directly
Engaging a social media influencer directly means that the Company will contract directly with the influencer and the financial transaction will be between the Company and the influencer.
In short, the Company will directly negotiate with and pay the influencer to provide a marketing, branding, or advertising service for that Company.
2. Engaging a Social Media Influencer via an Agency
Does a social media marketing agency need to pay tax? Engaging a social media influencer via an advertising, marketing, branding, or talent agency is slightly different.
In this case, the Company will contract directly with the agency for the services it requires. The agency will then contract (or sub-contract) directly with the influencer. This means that there will be two financial transactions – one between the Company and the agency and the second, between the agency and the influencer.
Whether a Company chooses to engage an influencer directly or via an agency, there are some key items that the Company must consider from the perspective of tax compliance in the Philippines.
While it is common for social media influencers to run their business as self-employed or individual consultants, some influencers may operate through a corporation, OPC, sole proprietorship, or partnership. The engaging Company (or agency) must be aware of what type of entity or vehicle they are dealing with when engaging a social media influencer. Under the local Philippine tax compliance framework, the compliance requirements may vary depending on the type of business entity engaged.
To ensure compliance, companies should:
By addressing these tax obligations upfront, businesses can foster compliant, professional partnerships with influencers while avoiding financial and legal risks.
In the Philippines, in general, a payor is required to withhold a certain amount of a payment paid to suppliers or service providers. The payor (or receiver of the services) must then remit the amount of payment withheld directly to the BIR. This is withholding tax. Importantly, the rate or amount of payment that must be withheld will also depend on the type of entity, or payee, that the payor is engaging.
For example, if a Company engages a self-employed social media influencer, the withholding tax rate might be between 5% -10% of the total value of the payment depending on the personal circumstances (e.g. revenue per fiscal year) of the influencer.
If a Company engages an agency to provide the service, the rate of withholding tax is more likely to be 2% (assuming the agency is a corporate entity). In short, a Company needs to understand what type of “business entity” they are dealing with to understand its withholding tax obligations.
In the Philippines, a Company that is required to remit withholding tax to the BIR is also required to complete and send a Certificate of Creditable Tax Withheld, or Form 2307, to the payee (usually a vendor, supplier or service provider) as evidence of the amount of tax withheld.
This certificate can then be used as supporting evidence by the supplier (and the Company) when computing income tax at the end of the fiscal year. So, not only will a Company have to apply withholding tax when paying a social media influencer directly – it will also have to provide certification of all monies withheld from payments to the influencer.
In the Philippines, for any payment in respect of services performed, the service provider is required to issue a service invoice. This is the primary document for recording transactions and includes different types like Sales Invoice, Commercial Invoice, Cash Invoice, Charge/Credit Invoice, Service Invoice, or Miscellaneous Invoice. An invoice can also be VAT or non-VAT.
Service providers can continue using their official receipts until they’re used up, and only as a supplementary document to the service invoice. These official receipts must be stamped with “THIS DOCUMENT IS NOT VALID FOR CLAIM OF INPUT TAX.”
Social media influencers earning from online content creation must comply with tax regulations outlined in RMC No. 97-2021. To avoid penalties, these obligations include proper registration, income reporting, and tax payment.
Here are 10 takeaways from RMC No. 97-2021 on the key tax responsibilities of influencers:
Takeaway No. 1 – The BIR has provided a definition for a social media influencer in the Philippines. See the first section of this article (above) for the full definition.
Takeaway No. 2 – However a social media influencer decides to run their business, they will be required to obtain a Taxpayer Identification Number, or TIN, and register their business with the local BIR office or Revenue District Office (RDO).
Takeaway No. 3 – Resident social media influencers, unless exempt, are liable to pay income tax on all income derived from sources within and outside of the Philippines.
Takeaway No. 4 – Social media influencers are also liable to pay business tax in the form of VAT or Percentage Tax, depending on the value of their annual gross sales.
Takeaway No. 5 – Social media influencers must keep Books of Accounts that have been registered with the BIR and depending on the financial status of the business, have those Books audited by an independent auditor each fiscal year.
Takeaway No. 6 – “Income” includes more than just cash payments. If an influencer receives free products in exchange for their service, postings, or promotions, the market value of those products should be declared as income for BIR and tax purposes.
Takeaway No. 7 – Social media influencers are also required to apply withholding tax to payments to their employees, suppliers, vendors, etc.
Takeaway No. 8 – Social media influencers working and resident in the Philippines are likely to be subject to tax on revenue generated by working with clients who are based outside of the Philippines. As such, social media influencers must consider rules on double taxation and the applicability of any tax treaties between the Philippines. Social media influencers must also understand their specific obligations on income from foreign-based companies and foreign-based social media platforms.
Takeaway No. 9 – Depending on the service provided by a social media influencer, income generated might be classified across many categories. Different levels of withholding tax could apply depending on the revenue source. Service fees and royalty fees are just two examples.
Takeaway No. 10 – The BIR has helpfully included a technical working example in RMC No. 97-2021. Social media influencers should review this example carefully to help clarify their tax obligations on the work they perform.
In summary, RMC No. 97-2021 is a very helpful resource for social media influencers in the Philippines to review and help understand their specific tax and compliance obligations when dealing with either their clients or generating revenue from social media platforms.
Collaborating with social media influencers can be a powerful marketing strategy, but it also comes with tax responsibilities. Ensuring proper documentation, applying the correct withholding tax, and verifying a social media influencer’s tax registration status are critical to avoiding penalties and maintaining compliance.
For businesses that regularly engage creatives, artists, and influencers, managing tax obligations efficiently is key to keeping operations smooth. CloudCFO is an industry leader in outsourcing tax services, ensuring BIR compliance, accurate reporting, and streamlined processes. If your business works with influencers as part of your marketing strategy, CloudCFO can provide the financial clarity and compliance support you need.
Explore CloudCFO services today and discover how we can support your startup or SME’s tax and compliance requirements here in the Philippines!
This article was published with accuracy and integrity as priorities and is currently scheduled for formal peer review. The content has been thoroughly researched and reviewed internally; however, it may be updated pending outcomes of the peer review process.
[1] https://cruzmarcelo.com/bir-reminds-youtubers-and-other-social-media-influencers-to-pay-their-taxes/
[2] https://bir-cdn.bir.gov.ph/local/pdf/RMC%20No.%2097-2021%20(1).pdf
[3] https://bir-cdn.bir.gov.ph/local/pdf/RMC%20No.%2097-2021.pdf
[4] https://www.taxumo.com/blog/bir-rules-on-receipts-transitioning-to-invoices/
Stay BIR-compliant without the stress. Our tax team handles your filings, payments and tax planning every month.
Explore this service →or book a free consultation
Questions about how this affects your business? Our team replies within one business day.
![BIR Form 2303 or the Certificate of Registration: The Key Tax Compliance Document for PH Businesses [2026 Update]](https://cdn.prod.website-files.com/6abb649ace693a5b89cd1f0d/6acdaa89487fec15bcf8b451_6acda4b16be660d665036059_blog-bir-certificate-of-registration.jpeg)
