AI Training Guide · Step 11 of 11
Getting Paid and Taxes as an AI Training Contractor
AI training platforms usually take you on as an independent contractor; Mercor and Ethos both say so in their own terms. Mercor states it does not deduct tax from your pay, so handling tax is your job.
Sources: Mercor taxes and work authorization, Ethos expert terms.
This guide covers how the money reaches you and the basics of tax in the US and UK. It is general information, not tax advice; for your own situation, ask an accountant.
- This page is general information for educational purposes only. It is not financial, tax, legal or investment advice.
- Tax rules depend on where you live and your personal circumstances, and they change. Speak to a qualified accountant or tax adviser before you act.
- Platform details, fees and payout options were correct when checked (dates shown) and may have changed. Confirm them on the official pages.
- DigiNo is not responsible for any loss or decision based on this page. You use it at your own risk.
How the Money Reaches You
Pick the Cheapest Way to Get Paid
Many platforms pay through a contractor payout service that lets you choose how the money reaches you. The choice matters: the same payment can arrive free in minutes or lose a percentage on the way.
| Payout method | Speed | Cost |
|---|---|---|
| Local bank transfer (UK) or IBAN | Minutes | Free |
| ACH to a US bank | Minutes | A small flat fee |
| Wise wallet | Minutes | Free |
| Revolut (US dollars) | Minutes | Free |
| Payoneer | Minutes | 1% of the payment |
| Instant card transfer | Fastest | 2%, with a cap |
| PayPal | Minutes | 2.5% of the payment |
| SWIFT bank transfer | Up to 2 to 3 business days | A flat bank fee, the most expensive option |
Options shown to a DigiNo trainer on one platform's payout screen, October 2026, for UK pounds and US dollars. What you see depends on your country and currency.
Watch the exchange rate as well as the fee. If you are paid in dollars and choose to receive pounds or euros, the payout service converts the money at its own rate before it reaches you. Where you can, receive the original currency into Wise and convert it yourself at the mid-market rate, with the fee shown before you convert, any day of the week. That is our pick. If you already use Revolut, it works too, but it adds a fee at weekends and above its monthly plan allowance, so convert on a weekday.
Sources: Revolut fees (US), Revolut exchange fees and limits, Wise pricing.
When I set up payouts on one platform, it offered me a local bank transfer, an IBAN transfer, an instant card transfer, a Wise wallet and SWIFT for pounds, and ACH, PayPal, Payoneer, Revolut, Wise and SWIFT for dollars.
The free options that land in minutes were my local bank account and the Wise wallet, plus Revolut for dollars. PayPal, Payoneer and instant card transfers took a percentage, and SWIFT charged a bank fee and took days, so I skip those.
One catch: I am paid in dollars, and when I picked pounds into Wise, the payout screen added its own exchange rate. Receiving dollars and converting them myself in Wise avoids paying for that conversion twice.
If you are paid in a currency that is not your own, a Wise account gives you local account details in several currencies, so you can get paid like a local and convert at the mid-market rate. Paid in US dollars? Revolut was also free and landed in minutes. Both are DigiNo affiliate links.
When Mercor, Ethos and Our Top Pick Pay
| Platform | When | How (own pages, checked 2026-10-06 to 2026-10-09) |
|---|---|---|
| Mercor, hourly contracts | Weekly, on Wednesday, for hours logged the previous Saturday to Friday | Stripe by default, Wise where Stripe is not supported. Stripe holds your first payout for 7 days |
| Mercor, deliverable contracts | In the next payout cycle, once every deliverable is approved | No time tracking; no pay for part of the work |
| Ethos | On an agreed cycle, weekly, monthly or at project end, after you invoice within three days of finishing | Through Revolut or Wise. You enter your country of residence, and Ethos checks it against the countries its payment providers support |
| Our top pick | Twice a month. Work from the 1st to the 15th is paid around the 20th, and work from the 16th to month end around the 5th (dates in US Pacific time) | Payroll asks for your country of jurisdiction, so make sure it is correct and upload the documents it asks for |
Sources: Mercor payments, Mercor contracts, Ethos expert terms, Ethos privacy policy.
Time Tracking and What Is Not Paid
Several platforms track your time with monitoring software. Mercor uses Insightful, which may take a few screenshots an hour. Similar tools can also record the sites and apps you use. Mercor reviews time logs every week and removes idle time, time outside the project and time spent on banned AI use, with an email giving the reason that you can dispute. Logging time you did not work can end a contract. Our top pick counts tracked time only while you are actively working on project tasks.
Some time is unpaid by design. Ethos does not pay for preparation time unless it was approved in advance, or for a project that is cancelled or ends early. On Mercor hourly contracts, required trainings and meetings count as logged work, but hours not captured in Insightful are not paid. Assessments are often unpaid too.
Sources: Mercor time tracking and pay policy, Mercor contracts, Ethos expert terms, Alignerr FAQ, CrowdGen qualifications.
Taxes in the US
- You are self-employed for this income, so you owe income tax and self-employment tax (Social Security and Medicare). The IRS self-employed tax center explains both.
- Platforms or payment services may send you a Form 1099 if your payments pass the IRS reporting threshold. Mercor, for example, collects a W-9 from US citizens and residents and sends a Form 1099-NEC through Stripe above the threshold. You must report the income either way.
- Report the income and your expenses on Schedule C, and work out self-employment tax on Schedule SE.
- If you expect to owe tax, pay estimated tax across the year's four payment periods using Form 1040-ES.
- Check your visa as well as your tax. Mercor offers no W-2 jobs and does not sponsor visas. Its guides say F-1 students can take its contract work on approved OPT or CPT but not STEM OPT, and most H-1B holders may not work outside their sponsoring employer.
Sources: Mercor taxes and work authorization, IRS self-employment tax, IRS Form 1099-NEC, IRS Form 1099-K, IRS estimated taxes, Mercor 1099 vs W-2, Mercor F-1 guide, Mercor H-1B guide.
Taxes in the UK
- If you work for yourself through these platforms, you may need to report the income to HMRC. GOV.UK explains when.
- If your self-employed income is above HMRC's trading allowance, register for Self Assessment by 5 October after the tax year and file a return.
- The tax year runs from 6 April to 5 April. Online returns are due by 31 January after the tax year ends.
- You pay Income Tax on your profits, and most self-employed people pay National Insurance through Self Assessment too. Read the Self Assessment guide for deadlines and payments on account.
- Mercor's UK guide adds three points. It pays individuals only, so if you run a limited company you are paid personally. You sign a W-8BEN on Mercor, usually giving your National Insurance number as the foreign tax number, and get no US tax form. And it cannot take anyone on a Student visa.
Sources: GOV.UK trading allowance, GOV.UK register for Self Assessment, GOV.UK deadlines, GOV.UK self-employed National Insurance, Mercor UK guide.
Records to Keep
- ✓Every payment received, with date and amount in your currency
- ✓Invoices you sent, if the platform needs them
- ✓Payout service statements and conversion fees
- ✓Business costs, such as a headset or part of your internet bill, where allowed
- ✓Your contractor agreement with each platform
Platforms help with some of this. Mercor lets you download a PDF payment report from its Earnings page. It does not issue invoices or employment verification letters, but you can make your own invoices and download an engagement letter as proof of the work.
Sources: Mercor earnings, Mercor UK guide, Mercor legal support.
What Working Trainers Say
Contractors on Reddit, including in tax forums, repeat the same habits.
- Set aside part of every payout from the first one. No tax is withheld, and in the US self-employment tax comes on top of income tax.
- Report all of it, even if no tax form arrives. The income is taxable either way.
- Keep a running spreadsheet of every payment, with screenshots of payouts and work records.
- Log your real active time, including reading instructions and failed attempts. Leave idle time out, never pad or shave hours, and stay inside each task's time limit. Time-log reviews happen and can end access.
This section draws on Reddit threads such as: Reddit thread, Reddit thread.
Living Somewhere Else?
Rules and deadlines differ by country. Ethos makes you responsible for your own tax and self-employment status wherever you live. Mercor has people outside the US fill in a W-8BEN, sends them no US tax form, and tells them to report the income under local rules with help from a local accountant. Check your local tax authority's guidance before your first payment arrives.
Mercor pays through Stripe in most countries and through Wise in a few, such as Brazil and Turkey, and publishes a list of places it cannot pay or onboard. Its EU and India guides say which local tax number goes on the W-8BEN, for example the PAN in India.
Sources: Ethos expert terms, Mercor taxes and work authorization, Mercor supported countries, Mercor EU guide, Mercor India guide.
Find your next platform
Chat with DigiNo Toucan. Two questions, no CV needed.
That completes the AI Training Guide. Ready to start? Apply to Mercor, Ethos or your top pick in the AI Training Job Matcher.
AI Trainer Pay and Taxes FAQ
How do AI training platforms pay?
Through payout services on the platform's own cycle. Mercor pays hourly contractors every Wednesday through Stripe or Wise, and Ethos pays on a cycle agreed for each project or at project end, after you invoice.
Do AI training jobs take taxes out?
Usually not. Mercor, for example, does not deduct tax: you are paid as an independent contractor, so you handle your own tax.
Do I need to pay taxes on AI training income in the US?
Yes. You owe income tax and self-employment tax, report it on Schedule C, and may need to pay estimated tax quarterly.
Do I need to register for Self Assessment in the UK?
If your self-employed income is above HMRC's trading allowance, yes. You then file a return by 31 January after the tax year.
Is this tax advice?
No. It is general information from the IRS and GOV.UK. For your own situation, speak to an accountant.
