As contract professionals in the creative industry, the jobs you take might involve many different pieces over years, but just as possibly you might produce one or two two-minute videos for a client filmed over an afternoon and edited the following day.
As an influencer, you might monetise your work through brand deals, sponsorships, host reads, streaming services, video platform revenue, subscription services or any combination of that list.
With so many revenue streams, such variety in jobs, and so many other possible questions, keeping your accounts accurate and compliant can be a full-time job of its own. Here are some key elements we recommend you watch for.
Do Account for Every Stream
There’s a persistent bit of tax misinformation out there which states that if an individual revenue stream is below a certain threshold it can safely be ignored. Needless to say, this is untrue!
All the same, whoever first spread this about was clearly very persuasive. Many people still believe this claim today, and it can create major issues for them once they start filing incomplete returns.
Know Your Expenses
If you upgrade your cameras, microphones, or lighting over a tax year, these would certainly be allowable expenses. The same would be true for ongoing subscriptions relevant to your work, new editing software, and a number of other items.
However, if you’ve bought something both for your professional work and your own use, and if you’ve spent enough that you might exceed expense limits, this becomes more complicated. We recommend consulting someone who can advise you on specifics before you make major purchases that might be affected, and don’t forget to keep a running tally through the year.
Be Ready to Register for VAT When You Need to
If your total turnover exceeds the VAT threshold in a single year, or you expect it to do so in the next 30 days, you must be VAT registered. As that turnover could include many different, tiny streams, keeping track of it is essential until you actually register.
At the time of writing that threshold is £90,000.
Understand How Business Structures Affect Your Bottom Line
As a sole trader, a partnership, or a limited company, the way you pay yourself, your tag obligations, your profitability and your personal liability can all vary. What company structure you use is a major decision factor as a result.
More importantly, these factors are influenced by your income, your expenditures, plans for expansion and even your tolerance for financial risk.
We strongly recommend discussing your situation with an experienced accountant who understands your field before making a decision. Why not get in touch to find out more?
