Many DJ's who are self-employed will have probably used an accountant at some stage. Many accountants don't have experience of dealing with DJ's and the peculiarities of our trade and sometimes accountant 1 will give you a list of items that are claimable which is a different from accountant 2's list.
For example everyone likely knows that we can claim on music purchases, petrol, stationary, dj eqpt etc but what about items like stage clothes such as a tux, dress shirt, props, or dry cleaning of stage clothes, entertaining prospective clients (meal/drinks) etc.
One accountant has told me that it's not possible to claim on the above, while a dj has told me that his accountant says this is possible.
If we put our minds/experience together maybe we can compile a comprehensive list of items that are claimable on tax for the mobile & club DJ, and save us all a few bob from the hands of the taxman.
The more unusual items will be especially welcome.
Any tax experts wanna kick this off?

There is also another area which you also need to consider when running a small business. Expecially if you run a full time operation, and charge good prices for your gig's. This is the dreaded VAT registration!.

Any business which turns over £56k in a 12 month period needs to register and charge / pay VAT to customs & excise. This is beyond the reach of most D.J's happily, but if you do go out for £400 - £600 per night several nights a week plus lucrative Xmas and New Years gigs then its going to bring you close to that target. Especially if you run other operations alongside the disco, such as quiz nights, hiring out, P.A hire etc. Unlike Tax, the VAT threshold is based on turnover rather than profit, which means that you are likely to reach it far sooner. Booking keeping for VAT is a right pain, so I suggest that you trim down your bookings, in order to stay the right side of the threshold.

If you run your disco alongside a full time occupation, then you are going to be penalised. Since you use up your tax allowance on your main occupation which means you are going to be taxed on every penny of your 2nd occupation .

Tax is a complicated subject, and far better to entrust it to an accountant. It's worth considering, since their services are not that expensive, and they will usually save you far more than their fee .

We do have a forum member who, I know, is also an accountant, so if he wishes to offer his services & advice for a fee, to other members then he can, but i'll leave that up to him

Chris,

I know this is something we have dicussed in the past, yes it is me that is an accountant, and I specialize in the entertainment industry.

Eskie, you can claim for many of the items in your list except entertaining future clients, which is not allowed for the self employed, however you can claim for staff parties.

any one that would like help, they can contact me and I would be happy to help, as a special offer I am willing to members end of year accounts & self asscesment returns for £150.00.

Ian, for a generalised discussion, may I ask a few small questions that might generally cover other Dj's 'accounts and finances'...

Q1) Is it true that a DJ can earn up to £14,995 and not pay tax if self employed?
Q2) Yearly 'over' expenditure, can be carried over to the following year as a loss?
Q3) Tax relief is available on PC's, internet and laptop purchases?
Q4) Monthly Sky TV payments can be put forward as 'office' or 'phone' expenses?
Q5) Account records now have to be kept for a maximum 12 years?

QUOTE (discodirect @ May 27 2003, 08:50 PM)

50Ian, for a generalised discussion, may I ask a few small questions that might generally cover other Dj's 'accounts and finances'... Q1) Is it true that a DJ can earn up to £14,995 and not pay tax if self employed? Q2) Yearly 'over' expenditure, can be carried over to the following year as a loss? Q3) Tax relief is available on PC's, internet and laptop purchases? Q4) Monthly Sky TV payments can be put forward as 'office' or 'phone' expenses? Q5) Account records now have to be kept for a maximum 12 years?

you can,

1) is this their gross or net income -
2) Yearly over expenditure (or losses) can be carried forward against future profits of the same trade
3) Yes your laptop, PC's etc are classed as machinery and become capital items, which have a wriiten down value (this used to be called depreciation), and although not in your profit & loss account are to be included in your balance sheet, (there is a section in the return for this) you also need to let your accountant when you sell this as adjustments need to be made. you also need to let him know what percentage is for business use, and which for personal. the same goes for software.
4) no they can't be put forward as office or phone, they are subscriptions, you can argue that you need to watch MTV etc to keep up with the latest music.
5) 6 years

entertainers are a gray area with the revenue, and many inspecters are not sure, but remember it is sel cetification, what you tell them is what you pay on, but remember you can have an inspection at any time without notice, so make sure your records are up to date, and if you have lied they will find out.

Also if you use it for your business, you can in 99% of cases claim for it somewhere.

another point to remember is that you must let the revenue know within 3 months of commencement of your new business, even if it runs at a loss. Or they will fine you.

if you have a PAYE job, it can pay to declare a loss making business, you could get a rebate i.e.

you earn £10,000 pa and pay tax at the basic rate, after personnel deductions you pay income tax of £971.90.

However you have just stared a new business, which has made a trading loss of £1,000, you can set this against you other income which means your tax liabilty should have been £751.90, meaning you have paid to much income tax (£220 in fact)

Thanks Ian.

I don't know if you would consider a FAQ thread in the future for all the DJ's or KDJ's, topic'ing some general hints or tips.

My present accountant has been very ill of late, and I may have to take you up on your offer in the future!

Regards

QUOTE (discodirect @ May 27 2003, 11:02 PM)

Thanks Ian. I don't know if you would consider a FAQ thread in the future for all the DJ's or KDJ's, topic'ing some general hints or tips. My present accountant has been very ill of late, and I may have to take you up on your offer in the future! Regards

No problems