“Taxation is just a sophisticated way of demanding money with menaces.”― Terry Pratchett, Night Watch
This line was from his fantasy novel that won the 2003 Prometheus Award, but when it was suggested his book had “darker” themes, he said:
‘A dark book, a truly dark book, is one where there is no light at the end of the tunnel’.
The Showbiz Accountant specializes in accounting for writers can provide light at the end of your expenses tunnel. As a self- employed author/writer, you may be surprised by how many expenses you can claim against tax (and a few you can’t). Don’t let tax issues ‘block’ your creativity, read on for some advice
What expenses can an author/writer claim?
Most tax-deductible expenses fall into one of the following areas:
As an author, you’re likely to work from home therefore expenses including mortgage or rent, council tax, lighting and heating, repairs, and decorating are all tax-deductible. The use of your phone and broadband for research purposes can also be claimed. If you employ someone to help you with research and/or proofreading the salary and NI contributions that you make are tax-deductible. Other key costs that can also be claimed include fees to your agent and publisher and subscriptions to the Society of Authors, Writer’s Guild, etc. The Showbiz Accountant can help you to calculate these.
Travelling, accommodation and subsistence costs associated with your research are allowable but this is a complex area, for example, you may travel abroad to the place your book is based and may choose to stay a bit longer as a holiday, therefore your accommodation costs would need to exclude the holiday element, (except for any incidental local costs incurred on your book project).
Whilst traveling for meetings, interviews, or research there are various costs that can be claimed such as, running costs calculated to include fuel, repairs, servicing, insurance, road tax, financing, or leasing costs. A claim can also be added for items such as parking, road tolls, and depreciation (capital allowances). It’s also possible to claim a business mileage allowance but there is a VAT registration limit in the year the car is purchased. We can guide you through the complexities of these expenses.
Some of the other expenses that will be accepted include postage, stationery and computer expenses. Theatre/cinema/museum tickets, reference books, CDs, journals, or newspapers but only if they’re relevant to your genre. You could also claim for courses, conferences, and any relevant professional fees.
Personal Appearances & promotional material
All of your hard work has paid off and you’re now promoting your latest masterpiece. On a book tour, being interviewed and attending book signings etc means you may be able to claim for hairdressing and makeup. Hosting and maintenance of your website, adverts and promotional photos are also allowable expenses.
Only expenses incurred solely in the pursuit of your business are usually allowable – although a percentage might be allowable if used partly for work. However, many expenses aren’t tax-deductible.
For instance, legal fees can’t usually be claimed against tax. Motoring expenses are only allowed when the travel is purely for business purposes. The cost of your meals isn’t usually allowable, as these could be classed as necessary for both work and leisure. Although, reasonable costs of food and drink when on a tour can be tax-deductible. But you can’t claim for the cost of a meal you might buy for your agent or a prospective client.
‘Ninety per cent of most magic merely consists of knowing one extra fact….’ Night Watch
We know that claiming expenses is a minefield but we know all of the facts about taxes and VAT. If you’d like help in finding your way through it, call The Showbiz Accountant (0203 3842224 in the UK or +1 424 228 9700 in the US) and we’ll guide you through it all. You can then relax, with peace of mind that you’ll receive as much as possible from what you’ve earnt, a sophisticated way of dealing with your taxes!