What you need to know about tax
'Where was Brian Tucker when I first started paying tax!?!'
This thought, going through my mind as I sat at an artisan workshop last week, kept me going through two hours of financial management speak. The workshop was specifically for artists and, while I’m not an artist by any stretch of the imagination, I do have the joy of working in a creative industry. In a consulting capacity, lots of fun questions arise, like: What can I claim as a business deduction?, Should I be charging GST?, and many more...
Thankfully, Brian is a godsend and it isn’t hard to see why he’s only just been able to open up his waitlist and see new clients again. I walked away having more clarity around tax than I’ve ever had and a burgeoning sense of confidence around the whole shebang.
The best thing I took away from the night was Brian’s simple way of deciding if something is tax-deductible. Brian recommends asking yourself three simple questions.
- Did it cost you something? Was the cost in the derivation of income? For example, website hosting fees, attending a workshop related to your core business activity.
- What percentage was work-related?
- What paperwork do you need? (For example, a travel diary or receipts etc)
As with anything, there are exceptions to the rule. Entertaining is not tax-deductible but there may be wiggle room with your portion of say, a meal had with a client, but only if you’re travelling on business. That great new in-season leather biker jacket you purchased for an upcoming business trip is not tax-deductible but if your business is, say, a jewellery maker, the protective clothing you may need to undertake that work could be.
Of course, every piece of advice he gave was general. Just like Brian we absolutely recommend seeking the consultation of a professional able to make recommendations based on your individual needs.
artisan is working to host more workshops just like this (and Homeroom will be doing a series of sessions with them in July/August), so keep an eye on their website for upcoming events. We'll see you there!