When your income goes up and down
An actor might earn very little for months and then land a long run or a commercial. A musician could have a busy summer of festivals followed by a quiet winter. A photographer might sell a big licence once and then nothing similar for a year. Tax works on each tax year from 6/4 to 5/4, so a single good year can push income into a higher band even if the average over three years is modest.
There is help for this. If your profits come mainly from creative works you have made yourself, such as writing, composing music, art, photography or design, you may be able to claim averaging relief. This lets you even out profits across two consecutive tax years where the profit for one year is less than 75% of the other, so you pay tax on a fairer figure. It cannot be claimed if your accounts are on the cash basis, which is now the default, so we may need to move you to traditional accounting first. Performing on its own does not usually qualify, so we check carefully whether you do before making the claim on your return.
Actors and performers
Most actors are self employed for tax and file a self assessment return each year. At the same time, some theatre, film or television contracts are paid through PAYE with tax already taken. Many performers end up with a mix of both, plus a part time job in a bar or shop on King's Road to cover the gaps. We bring it all together on one return and make sure PAYE tax already paid is credited.
The costs of staying in work are often allowable. Agent's commission, casting directory listings, union membership, headshots, showreels, voice or singing lessons that keep existing skills sharp, and travel to auditions all need looking at. Everyday clothes and haircuts usually are not allowed, even if you wear them on stage, but costumes and specialist items bought for a role can be.
What is included
- Self assessment tax return each year
- Combining PAYE and self employed income
- Averaging relief claims for creative profits
- Royalty and performing rights income reporting
- Foreign tax credit relief on overseas work
- Capital allowances on equipment and instruments
- VAT registration and returns if needed
- Limited company accounts for incorporated creatives
Musicians, royalties and work abroad
Musicians often earn from many places at once. Gig fees, session work, teaching, streaming royalties, performing rights income, merchandise and sync licences. Each source can arrive through a different organisation, sometimes from abroad and sometimes with foreign tax already taken off.
For working musicians, royalties are usually part of your trading income rather than something separate. When you tour or perform abroad, the country you play in may deduct tax from your fee. In many cases you can claim credit for that against your UK tax so you are not taxed twice. We collect the statements, work out what counts where, and claim the reliefs available.
Instruments, amplifiers, recording equipment and software are business assets, and their cost can usually be claimed through capital allowances.
Photographers, designers and visual artists
Photographers and designers usually spend heavily on cameras, lenses, computers and software. These can generally be written off against profit in the year you buy them, which is useful in a year of high income. If you also use the kit for personal projects, only the business share counts.
Designers who work mostly for one agency or client through their own limited company may need to think about IR35, the rules that decide whether a contractor is taxed like an employee. Photographers and artists selling prints or products online may also be getting close to the £90,000 VAT registration threshold without realising it, since that figure is based on total sales, not profit.
- Capital allowances on cameras, computers and instruments
- Studio hire, props and materials
- Software subscriptions and website costs
- Portfolio, exhibition and competition entry costs
Self employed or limited company
Most creatives start as sole traders, and many stay that way. It is simple and flexible. A limited company may help once profits are steady and you can leave some money in the business, or when clients such as production companies prefer to contract with a company. It also brings more admin and stricter rules on taking money out.
We compare both using your real figures. For some performers a company makes little sense because so much work is paid through PAYE anyway.
Creative clients in Fulham and nearby
Fulham, Hammersmith and Shepherd's Bush have long been home to people working in television, theatre, music and design. Many of our creative clients work from home or shared studios and travel all over London for jobs.
We start with a free review of your income and records and agree a fixed fee before any work begins. You can send statements, receipts and contracts online, and we will tell you what is missing in plain words.
Who this suits
- Actors and stage performers
- Musicians, composers and session players
- Photographers and videographers
- Graphic, fashion and interior designers
- Writers, illustrators and visual artists
Common questions
What expenses can actors claim?
Actors can usually claim agent's commission, union fees, casting directory subscriptions, headshots, showreels, travel to auditions and some training. Everyday clothing, haircuts and general fitness costs are usually not allowed. We go through your costs line by line.
Can I average my income as a musician or artist?
If your profits come mainly from creative works you made yourself, such as songs you have written, books, art or photographs, you may be able to claim averaging relief. It spreads profits evenly over two consecutive years where one year is less than 75% of the other, so one good year does not lead to a much higher tax bill. It is not available if you use the cash basis.
How are music royalties taxed?
For a working musician, royalties from streaming, performing rights and licensing are usually treated as part of your self employed trading income. They go on your self assessment return with your other earnings.
I was paid through PAYE and as self employed. What do I do?
You file a self assessment return that includes both. The tax already deducted under PAYE is credited against your total bill. Your employment details come from your P60 or P45.
Can I claim my camera or laptop against tax?
Usually yes. Equipment bought for your business can generally be claimed through capital allowances, often in full in the year you buy it. If you also use it privately, you claim only the business share.
Do I pay UK tax on money earned performing abroad?
If you are UK resident, you are generally taxed in the UK on income from abroad. If tax was taken off in the other country, you can often claim a credit for it so you are not taxed twice on the same income.
Do creatives need to register for VAT?
Only if your taxable sales go over £90,000 in a rolling 12 month period, or you choose to register voluntarily. Some creatives register early so they can reclaim VAT on equipment, which can make sense if most clients are VAT registered businesses.