HMRC Has Written to Me About My OnlyFans Income: What Do I Do Next?

If HMRC has written to you about your OnlyFans income, it almost certainly holds data showing what you earned through the platform and wants to compare it with what you have declared. What you should do next depends on which letter you have received. An informal letter asking you to check your tax affairs carries a different risk from a formal information notice with a legal deadline. In either case, the worst responses are ignoring the letter and guessing at figures.

Creators in this position usually have one of two problems. Either they never registered for Self Assessment, or they filed returns that understate what they earned once tips, pay per view messages and other platforms are counted. Both can be put right, and the cost depends heavily on how and when you respond.

Why HMRC Knows What You Earned

Since 1 January 2024, digital platforms within the Platform Operators (Due Diligence and Reporting Requirements) Regulations 2023, SI 2023/817, have had to report what their sellers earn to HMRC. Regulation 4(1) requires each report by 31 January following the end of the reporting period, so the first reports covering 2024 reached HMRC in January 2025. The rules cover personal services as well as sales of goods, and regulation 4(4) requires the platform to send you a copy of the same information. Check your emails and platform account for it, because it shows you what HMRC already knows. Our guide to HMRC compliance checks and how to respond explains what HMRC does with this data.

HMRC also compares bank and other third-party data against your returns, and it works through the results in campaigns, which is why letters often arrive about income from two or three years ago. It has already done the same with sellers on online marketplaces, and our earlier guide to dealing with HMRC as an OnlyFans model covers how creator income is taxed.

Work Out Which Letter You Have

The most common letter is a nudge letter. It says HMRC holds information suggesting you have undeclared income and invites you to check and correct your position. There is no formal legal power behind it, but ignoring it is a mistake, because HMRC uses your response, or the lack of one, to decide whether to open a formal check. Our guides to HMRC nudge letters and to what to do after receiving an HMRC letter set out the first steps.

A formal compliance check is different. HMRC will say it is opening an enquiry or checking your position and will ask for records by a stated date. An information notice under Schedule 36 to the Finance Act 2008 creates a legal obligation to provide what HMRC reasonably requires, and failure can lead to a £300 penalty followed by daily penalties of up to £60. Our guides to Schedule 36 notices and how much you must disclose explain your rights, including the right to appeal parts of a notice. If the letter mentions Code of Practice 9, HMRC suspects fraud and you have 60 days to respond, so read our guidance on responding to a COP9 investigation before doing anything else.

If You Never Registered for Self Assessment

If you earn more than the £1,000 trading allowance from content in a tax year, you will usually need to register. Section 7 of the Taxes Management Act 1970 requires you to tell HMRC by 5 October following the end of that tax year. Missing the date exposes you to a failure to notify penalty under Schedule 41 to the Finance Act 2008, calculated as a percentage of the unpaid tax. The maximum is 30 percent for a non-deliberate failure, 70 percent for a deliberate one and 100 percent where it was also concealed. If you register late but pay all the tax by 31 January after the tax year, the penalty should be nil. Late returns attract separate penalties, explained in our guide to late Self Assessment returns.

Telling HMRC yourself and cooperating reduces those maximums substantially. For a non-deliberate failure, HMRC’s guidance sets the minimum at nil where the disclosure is unprompted and HMRC learns of the failure within 12 months of the tax first becoming unpaid, and at 10 percent where the disclosure is prompted. A disclosure made after HMRC has written to you is likely to count as prompted, which is why coming forward first is always cheaper. Our guides to voluntary disclosure and reducing penalties and the 2026 voluntary disclosure guide explain the process.

How Far Back HMRC Can Go

The ordinary time limit for an assessment is four years under section 34 of the Taxes Management Act 1970. Section 36 extends it to six years where the loss of tax was careless and 20 years where it was deliberate. For most creators, the question of whether the failure was careless or deliberate decides both how many years are reopened and the size of the penalty, so it should never be conceded casually in correspondence. Our guide to careless, deliberate and concealed behaviour explains how HMRC decides, and our page on discovery assessments covers the power HMRC uses to assess earlier years.

What Counts as Income, and What You Can Deduct

HMRC looks at all your income from the activity: subscriptions, tips, pay per view messages, custom content, other platforms and direct payments from fans. Gifts and wishlist purchases sent because of your content are likely to be treated as part of the same income. The platform’s share is a cost, so the starting figure is what fans paid before that share was taken. Many creators record only the net payout, and that gap is where disputes often begin. Our guidance on managing an HMRC tax enquiry explains how to reconcile the figures before HMRC does.

Against that income you can deduct the costs of producing content, such as equipment, lighting, software and agency fees, plus a justified proportion of costs that are partly personal. Alternatively you can use the £1,000 trading allowance, but not both. Keep receipts and a clear note of business use, because HMRC disallows expenses that look personal, and an inaccurate return then attracts the penalties described on our HMRC penalties page.

VAT, Which Catches Creators Who Grow Quickly

You must register for VAT if your taxable turnover goes over £90,000 in any rolling 12 month period, or if you expect it to within the next 30 days. The test looks back over any 12 months, not the tax year, so fast growing creators can cross it without noticing. How VAT applies to platform income is technical, because it depends on who is treated as supplying the fan and where the fan is based. Take advice before assuming VAT does not apply, and if HMRC has already raised a VAT assessment, our guidance on HMRC internal reviews and appeals explains how to challenge it.

Privacy and Discretion

Many creators do not reply to HMRC because they worry about who will find out. HMRC officers are bound by a statutory duty of confidentiality and do not share your tax affairs with family, landlords or employers. Income earned under a stage name is still declared in your own name, and you can authorise a representative so that HMRC writes to them instead of you. If discretion matters, have a representative handle the HMRC investigation so that the correspondence comes to us. Do not agree to an informal meeting without advice either, and read our page on HMRC interviews if one is proposed.

The Mistake Many Creators Make: Assuming the Platform Has Taxed You

Because the platform is a UK company that takes its share and reports to HMRC, many creators assume their tax is already dealt with. It is not. The platform does not deduct income tax or National Insurance, and its report is information, not payment. You remain responsible for registering, declaring and paying. Creators who misunderstood this can often use it to argue that their failure was careless rather than deliberate.

If an agency, manager or online adviser told you platform income was not taxable, or sold you a structure to avoid tax, and that advice was wrong, you may have a claim against them. Our guidance on suing an adviser over bad HMRC advice and on claims against negligent accountants and tax advisers explains when that route is open.

What Not to Do After the Letter Arrives

Do not ignore the letter, and do not reply the same day with a figure estimated from memory, because HMRC will measure you against it. Do not delete your account, content or payout history, since those records are your evidence and destroying them after HMRC has written can be treated as concealment. Do not accept HMRC’s figures without checking them against your platform statement, as reports across several platforms can double count or fall in the wrong year. If you need more time, ask in writing before the deadline, since our guide to late appeals against HMRC shows how hard it is once a deadline has passed.

If You Cannot Pay What HMRC Says You Owe

Several years of undeclared income with interest and penalties can produce a bill you cannot pay at once. HMRC will often spread payment if you engage early with a realistic proposal, as our guide to HMRC Time to Pay arrangements explains, and a penalty may sometimes be suspended on conditions.

If the debt is left unpaid, HMRC can move to enforcement. Most creators trade as individuals, so the risk at the end of that process is bankruptcy. Our guidance on whether HMRC can make a sole trader bankrupt, on Breathing Space and our bankruptcy advice page explain the stages and protections. Creators trading through a company face the corporate version, covered in our guide to HMRC enforcement becoming insolvency action.

Deadlines That Will Not Wait

Every letter of this kind has a date. A nudge letter gives a date for a response, a Schedule 36 notice gives a date after which penalties start, and a COP9 letter gives 60 days. Diary the date the day the letter arrives. If you intend to challenge a decision HMRC has already made, most decisions must be appealed within 30 days, and our page on the First-tier Tax Tribunal explains what happens if the dispute cannot be resolved with HMRC.

How We Can Help

We act for content creators who have received HMRC letters about platform income, and we deal with HMRC directly so the correspondence comes to us. We review the letter and platform data, reconstruct your income and expenses, make disclosures on the most favourable basis available, argue for the right behaviour category and penalty reduction, respond to Schedule 36 and COP9 letters, negotiate time to pay and appeal where HMRC’s figures are wrong. We do not prepare routine annual tax returns, offer free legal advice or legal aid, and we generally take on substantial matters. More on our tax work is on our taxation solicitors page.

LEXLAW is a firm of dual qualified solicitors and barristers with chambers in Middle Temple, next to the Royal Courts of Justice. We offer a fixed fee advice conference with both a solicitor and a barrister, so you understand your exposure before you say anything to HMRC. What you tell us is confidential and protected by legal professional privilege. Start with our case assessment form, which goes directly to our tax litigators.