Tax in the webcam industry?
So I’ve been a webcam model (if you can call it that) since 2018 when I was 18 at university. I was actually pretty good at filling out self assessment tax forms as soon as I made an income. For the first few years it was nothing too significant (15k,22k and 30k), but I declared it all straightforwardly as I used to get paid directly by wire transfer from chaturbate to the UK (no intermediaries).
The issue probably arose in 2022 when I started to cross 60-70k, I realised I was losing a lot of money each time I did a wire transfer as it was $45 bi-monthly. I looked into other options and came across a payment processor called Paxum (based in Belize I believe). I begun to use this and then transfer payments from chaturbate to Paxum and then to my uk bank. I only put the money that I received into my UK bank via Paxum on my self assessment form (rather than converting the dollar value that I actually received to my Paxum account).
Anyway, the situation gets more confusing because my income started to explode. I went over 100k a year and then 200k etc, and simultaneously I began to get my bank accounts frozen in the uk because of “suspicious payments from my overseas account”. I proved that these originated from chaturbate and that I had paid tax, but a couple of banks held my money for prolonged periods of time. As a byproduct of this issue, I started to accumulate a lot of money in my Paxum and even put some into crypto because I lost faith in the uk banking system. I even decided to use a Paxum prepaid card to withdraw an emergency fund in cash (probably 10k in total) which I now know probably raised more alarm bells, but when I was 24, I had the mindset of it’s my money, and I’ve paid tax on it, so screw the banks who had frozen my money and I’ll make sure I have some in cash. This was the only way for me to actually have access to my cam earnings at the time without risking them getting frozen. I still declared whatever I took out into my uk banks and the ATMs, but for the most part I just left a bulk of my money in there. At this time Santander had frozen 40k for 8 months, and so I was told I was no longer entitled to it. Because I couldn’t use that to pay my taxes, I simply didn’t declare it, until the following year, when I ended up getting it back via the ombudsman with hefty compensation.
In total I have probably paid £150-200k in taxes to HMRC. However, I’m still worried about the consequences of not getting it 100% right. I now have a limited company and just do the wire transfers again to keep things more transparent. I know one day I’ll probably get a huge fine