UAE

Influencer Payment Regulations in
UAE
Playbook

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UAE
is a few seconds with Gigapay.
With Gigapay, you can easily onboard and pay influencers in
UAE
, all while adhering to the relevant local laws and regulations. Simplify your payout processes with Gigapay.
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Capital

Abu Dhabi

Currency icon
Currency

AED (د.إ)

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DAC7

No

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Preferred Payment Method

PayPal, Bank Transfer

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UAE
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UAE
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UAE

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UAE
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UAE
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Our guide to paying creators in
UAE

Navigate the tabs below to learn everything you need to know about paying creators in
UAE

Individual

If the influencer is acting as an individual without any registered activity, it is essential to be aware of applicable rules and regulations, as you may have additional responsibilities towards the individual. It is important to understand what legal obligations apply to you. You may for example have withholding responsibilities or be required to pay social costs.

What is an Individual?

A person providing a service to someone without actually registering an activity. It could for example be someone helping the neighbour with their math exercises before a test for a small fee.

Is it possible to make payouts to the creator?

Individuals need to apply for a license or work through a licensed agency if they wish to receive compensation for their work on social media.

Sole Trader

Receiving compensation as an individual can be tricky and may sometimes raise concerns related to employment laws and taxation rules. Therefore, it is quite common for influencers to register their activity as sole traders in their country of work. In fact, most countries have simplified systems allowing persons to register their activity in a quick and easy way. This allows influencers to invoice their clients and pay their taxes in a more streamlined way.

What is a Sole Trader?

A sole trader is typically a self-employed person who owns and runs their own business as an individual. Sole traders usually benefit from a simplified system designed to make it easier to start a business.

Is it possible to make payouts to the creator?

Yes.

Private Trader

Company

If the influencer is popular, it is not uncommon that they have a registered company and a whole team working with them (billing, project management, technical team, ...).

What is a Company?

A company is typically a legal entity formed by a group of individuals to operate a business enterprise. It may be organized in various ways for tax and financial liability purposes depending on the corporate law of its jurisdiction.

Is it possible to make payouts to the creator?

Yes.

Hobby

Due Diligence

In order to assess your responsibilities towards the influencer, it is necessary to define your relationship and follow a proper due diligence process catered to the status of the influencer and their country of activity. This may include requesting information about their name, whether they have a license or not, TIN number, age, and more.

It may also be relevant to do some research about the influencer's followers in order to verify that their followers fit the kind of content or product you would like to advertise. This is especially important if the followers are young (e.g. it may not be appropriate to advertise alcohol to underage followers).

New Self-Employed or Registered Business?

Common Ways of Working as an Influencer in the UAE

If an individual would like to start working as an influencer in the UAE, they will need to either obtain a license (individual or group license) or sign an agreement with an influencer agency certified by the National Media Council (NMC).

NMC license must be renewed annually, there are three options for the NMC license, as follows:

  • Individual license: Ideal for influencers who want to work as completely independent social media influencers. The only drawback is the cost of the high cost of the license. The influencer can apply online for the influencer license by visiting the NMC website.
  • Small group license: The social media license covers small groups of influencers who want to come together and set up a company. This approach has the advantage of being less expensive per person than the first one.
  • Sign up with one of the official Dubai social media influencer agencies already certified by the NMC:  If the influencer signs a contract with an NMC-certified agency, they won’t need to bear the cost of the license but the agencies come with their own set of requirements which could limit the influencer's creative freedom. The drawback is less control over the content the influencer needs to promote.

The influencer may apply for a license on the NMC website. If the influencer is found to be working as a social media influencer without holding an NMC license, they risk a fine of AED 5,000 and it may, in some cases, result in the suspension of their social media accounts. Please note that owners of personal websites, bloggers, or people who promote their brands on social media do not need to apply for a license. The license is also not necessary when people do unpaid reviews of products.

Payment Method

The most common payment method used to pay influencers in the UAE is PayPal and bank transfers.

According to the Federal Tax Authority(FTA), UAE-based artists and SMIs are required to register for VAT if the value of their taxable supplies and imports (goods or services) in the last 12 months exceeded the mandatory registration threshold of AED 375,000 (conditions apply).

In the UAE, businesses may outsource invoicing operations to a third party or to the customer if certain circumstances are met. You may use self-billing if the parties have agreed to use self-billing prior to issuing the invoice. The agreement should preferably be in writing and specify the terms applicable to the self-billing invoice.

Gifting, Travel, and Vouchers

As a general rule, gifts are considered to be a form of compensation, and influencers should therefore always report the value of gifts, free travel, and vouchers to their tax authorities. The taxable value is usually based on the commercial value of the gift, travel, or voucher.

It is not uncommon for companies to be legally required to report to tax agencies when they pay out compensation to an influencer. Influencer partnerships are quite different from regular partnerships, compensation may not only include monetary compensation but also free gifts, vouchers, and travel. In some countries, all types of compensation sent for “payment” to the influencer should be reported. Therefore, it may be relevant to verify your reporting responsibilities on that matter.

In the UAE, when assessing if the influencer is reaching the registration threshold of AED 375,000, they should also count any free products or experiences they have received in return for their services.

Tax and Reporting Implications

Exchange of income statements to other countries.

As mentioned above, it is not uncommon for companies to be legally required to report to tax agencies when they pay out compensation to an influencer. This obligation may also be applicable if you are working with an influencer from another country. Many countries sign bilateral agreements in which they agree to exchange income statements with each other. This allows tax agencies around the world to have a better overview of the compensation paid out to the people conducting business in their country and better control over who should pay taxes or not. The exchange of income statements is especially relevant when paying out compensation to individuals without a registered activity. It is therefore important to verify your reporting obligations in your country.

Additional responsibilities - social fees, withholding of taxes, more

Before drafting an agreement with an influencer, it is important to consider if the person has a registered activity as an influencer or a company. If the influencer is acting as an individual without any registered activity, it is essential to be aware of applicable rules and regulations, as you may have additional responsibilities towards the individual. It is important to understand what legal obligations apply to you. You may for example have withholding responsibilities or be required to pay social costs. It is important to be fully aware of all the responsibilities before drafting any agreement with an influencer as you may be able, depending on the applicable laws and regulations, to put some of the responsibilities onto the influencer if it is clearly stated in the agreement. It is also important to consider any potential liabilities arising from the agreement. As such, the responsibility of each party should be clearly described in the agreement and preferably regulate topics such as the payment of indirect and direct taxes, reporting to tax authorities, or even social costs.

Advertising and Marketing Law

In most countries, influencer marketing is already regulated by national laws such as consumer protection and marketing laws or specific guidelines.

Considering influencers can reach consumers globally, examining legal implications in various countries is important. Violating the rules can lead to penalties, fines, and legal fees.

It's important to note that there are topics that are usually more strongly regulated within influencer marketing. These commonly include:

  • Children and minors.
  • Alcohol, religious beliefs, adult content, tobacco, cosmetic procedures, gambling products, and in certain countries politics.

Work on this is progressing quickly both on a national and a global level. It would therefore be wise to keep yourself updated on new laws and guidelines being issued on the topic.

Influencer marketing regulations in the UAE

In the UAE, a number of laws and regulations apply to social media influencers. The laws and regulations aim to protect the public from harmful or illegal content and ensure that social media is used in an ethical and responsible manner. For example, creators and influencers must disclose any sponsored content or partnerships with brands in order to maintain transparency and prevent misleading advertising.

The UAE social media influencer law prohibits influencers from making false or misleading claims about products or services, and from using their platform to spread hate speech or incite violence. Those who violate the law may face fines and/or imprisonment.

Also, as defined above, anyone who participates in paid promotional work on social media must apply for a license from the National Media Council(NMC).

The rules apply to social media influencers who are paid for their work in cash or gifts of an equivalent value. To acquire the NMC license, you need to apply for what is known as an E-Media license. Influencers who occasionally receive products to review on social media or produce content on their website don’t necessarily need to apply for a license.

On top of applying for a license, the influencer must comply with a number of rules, i.a.:

  • Maintain a record of all materials they have promoted on social media;
  • Comply with laws around photography, defamation, and privacy;
  • Avoid any blasphemous statements;
  • Avoid political statements and religious statements or sharing messages that may disturb the peace;
  • No promotion of alcohol.

You may read more on this topic here.

Agreements

Risk of false self-employment

If you are looking to collaborate with independent workers, it is essential to treat them as such. Influencers working independently should be treated differently from employees. It is crucial to provide them with creative and personal freedom, allowing them, for example, to choose and determine their own activities and working hours. To prevent a relationship that could be seen as an employment relationship, it is imperative to draft a clear agreement between the two parties. If the relationship is too close to an employment relationship, it may be viewed as false self-employment. This may come with legal implications for the brand. Without an unambiguous agreement, a clear distinction is not always easy; both influencers and those who use them are often unaware of how the relationship can be viewed by the authorities.

As a rule of thumb, the more instructions you give regarding the services to be performed and the more the person is bound to your organization, the more likely it is that an employment relationship exists. To ensure that your relationship with the influencer is as unambiguous as possible, it is important to make sure that the agreement that is established is fair and offers them the autonomy to choose their own activities and working hours. Also, the relationship should also be independent in facts not only on paper. This should allow for a successful collaboration. In the case of false self-employment, the brand or agency may be responsible for paying employer fees and social costs for the influencer.

An Agreement can take many forms and does not necessarily have to be in writing. However, it’s usually recommended to sign a written Agreement with the digital creator before they start to work on a project. We recommend having a legal professional review the agreement before it's signed, to ensure that it covers all the necessary legal aspects relevant to the relationship at hand. It may be relevant to define the following points in the agreement:

1. Define Compensation Structure and Amount

Begin by specifying the type and amount of compensation the influencer will receive for their services. This can be a flat fee, commission-based, or a combination of both. Be transparent about the compensation structure and ensure that the influencer understands whether they are considered an employee or an independent contractor, as this has tax implications.

2. Outline Payment Schedule and Currency

Establish a clear payment schedule that details whether the influencer will receive a one-time payment or multiple installments. Also, specify the currency in which payments will be made, and discuss potential fluctuations in exchange rates to avoid confusion or disagreements.

3. Specify Payment Terms for Content Creation and Sharing

One important consideration is whether payment should only be made upon delivery of the post or if there should be two separate fees, one for creating the content and another for sharing it upon approval by the Brand. Clearly state these terms in your agreement to ensure both parties understand when and how payments will be made for each aspect of the influencer's work.

4. Detail Payment Methods and Third-Party Involvement

Outline the method of payment, whether it's PayPal, wire transfer, or through a third party. If you're using a third-party service provider, such as Gigapay, to handle payouts and reporting, include this information in the agreement. This helps set expectations and ensures the influencer knows who will send the payment and when to expect it.

Want to know more about influencer partnership agreements? Use this guide to ensure your agreements cover all essential aspects and foster long-lasting, mutually beneficial relationships with your influencers.

Simplified compliance process

With Gigapay you can start working with creator in a breeze. Forget about complicated KYC process and a long chain of approval. Simply upload your spreadsheets with the emails of who you would like to pay and we handle everything for you. We tank care of collecting all the necessary legal information in order for you to pay influencers.

A woman with long red hair smiling at the camera.

Simplified compliance process

With Gigapay you can start working with creator in a breeze. Forget about complicated KYC process and a long chain of approval. Simply upload your spreadsheets with the emails of who you would like to pay and we handle everything for you. We tank care of collecting all the necessary legal information in order for you to pay influencers.

A woman with long red hair smiling at the camera.

Simplified compliance process

With Gigapay you can start working with creator in a breeze. Forget about complicated KYC process and a long chain of approval. Simply upload your spreadsheets with the emails of who you would like to pay and we handle everything for you. We tank care of collecting all the necessary legal information in order for you to pay influencers.

A woman with long red hair smiling at the camera.

Simplified compliance process

With Gigapay you can start working with creator in a breeze. Forget about complicated KYC process and a long chain of approval. Simply upload your spreadsheets with the emails of who you would like to pay and we handle everything for you. We tank care of collecting all the necessary legal information in order for you to pay influencers.

A woman with long red hair smiling at the camera.

Note: The information provided on this website does not, and is not intended to, constitute legal advice. All information, content, and materials available on this site are for general informational purposes only.

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