Tax & benefits

© Maria - Adobe Stock
Campaigning for a fairer tax and benefits regime for authors.

Current tax and benefit rules do not work well for authors. Many authors hold a number of jobs to sustain a creative career, and need to navigate a complex, bureaucratic tax system. Those who are registered solely as self-employed do not receive holiday or sick pay, or other employee benefits such as company pensions.

A 2016 European Commission study on authors’ remuneration which surveyed authors, journalists, translators and illustrators across Europe found that UK writers had less protection than in many other countries. For example the AGESSA scheme in France allows authors to receive benefits such as sick pay and unemployment benefit, with publishers and other content users making contributions to the fund. Similar provisions apply in Germany.

The only thing that hurts more than paying an income tax is not having to pay an income tax.

Thomas Dewar – Income Tax, Pay, More

Universal Credit

Emerging and struggling authors face difficulties in claiming benefits. Under the old system, which is now being phased out and replaced by Universal Credit, some authors with low earnings could claim Tax Credits to supplement their income. This enabled them to dedicate more time to their writing, ensuring that they could continue to write as a profession.

But the introduction of Universal Credit means that the self-employed must meet the “Minimum Income Floor” to receive benefits. This is equivalent to the National Living Wage for most working-age people. Given the median annual income of a professional author is £10,500, which is well below the National Living Wage, many authors will lose their entitlement to benefits under Universal Credit.

Furthermore, a self-employed worker’s entitlement to Universal Credit is assessed monthly. This will make it even harder for professional writers to reach the Minimum Income Floor and claim Universal Credit, as authors’ incomes are not stable and tend to fluctuate from month to month.  

We are calling for reforms to Universal Credit so that it does not penalise self-employed creators on low incomes. We also believe it should deal with “lumpy” incomes by basing payments on average incomes over two years. This would ensure that authors are paid benefits in lean periods and do not fall out of benefits on receiving an advance or royalty cheque.

Making Tax Digital (MTD)

The Treasury announced in December 2022 that compulsory use of HMRC’s Making Tax Digital (MTD) scheme for Income Tax Self-Assessment will be delayed for two years to 2026, having already pushed the date back to 2024 because the technology was not ready. They have also substantially raised the minimum threshold from £10,000, representing a move that will protect authors, which we have been campaigning for since 2017.

Digitisation is a vital update to the UK tax system, however we welcome this necessary delay. Implementation of the programme in its proposed form would have forced any freelancer with an annual income of over £10,000 to file quarterly updates to HMRC using new software which is yet to be piloted. This would have been an onerous administrative and financial burden to place on lower paid workers and would have led to numerous complications.

The new minimum threshold will be £50,000, effective from April 2026, reducing to £30,000 from April 2027.

We sincerely hope that the government will take this time to continue to review the proposed changes, so that they do not make unreasonable demands of lower paid workers’ time and money, including scrapping the proposed quarterly returns, as the current system of a single, annual payment is perfectly adequate.

National Insurance Contributions (NICs)

In September 2018 the Government announced that it was dropping plans to abolish Class 2 NICs. This is good news for the lowest paid, but we question why HMRC has completely rolled back plans that would have benefited 3.4 million people.

Class 2 NICs are paid by self-employed workers earning more than £6,365 (2019/2020 figures). Those earning below this threshold can make voluntary Class 2 contributions of £3 a week to access benefits such as the state pension. Had Class 2 NICs been absolished, those earning below the threshold could only have made voluntary contributions through Class 3 NICs, which are £15 a week. This adds up to £780 per year, a fivefold increase on the Class 2 annual contribution of £156.

The SoA submitted evidence and met with HMRC officials, in order to express concern that this change would disproportionately affect authors and other creators who are already struggling financially. We are pleased that HMRC has listened to concerns of the lowest-paid earners. However we urge the Government to continue to find an approach to National Insurance which simplifies the system for everyone, whilst protecting the pensions of the lowest paid.


Creators’ work is the foundation of the largest sector within the UK economy. Yet their needs are repeatedly ignored when policy, economic and support decisions are being made. 

We are a member of the Creator’s Rights Alliance (CRA) #PayTheCreator campaign, which brings together the campaigning work of member organisations to collectively call for creators of all types to be paid properly for the work they do, and the rights they grant, and to be given the same considerations enjoyed by other workers in the areas of pay, business support and policy making. 

Pay The Creator campaign logo

Related links