Stage clothes – Clothes that you only wear on stage can be claimed for 100% of the cost
· Ordinary clothes – As highlighted above, this is a grey area, but the official line is, “the cost of ordinary every day clothing is not allowable – even if it is bought specially for business use”
· Footwear – The same rules apply as with clothes
· Overnight accommodation – Where the trip necessitates one or more nights away from home the hotel accommodation and reasonable costs of overnight subsistence are deductible. The costs of lunches are not normally allowable, unless you are travelling on business (for example, you are on a train from London to Edinburgh) in which case modest expenses may be deducted.
· Travel – Travel to and from a regular gig at a regular venue will not usually be classed as business mileage for tax purposes. The reason for this is that the inspector will say that as you are at the venue so often, your trade is carried on from there, and not from home. You will have to convince him that although you do this gig quite a lot, your business as a musician is based at home. The best way of doing this is to show that you have other gigs elsewhere.
· Stationery – Envelopes, paper, cost of printing, letterheads and business cards, pens, pencils, desk diary, photocopying, accounts, books etc. Small items of office equipment – files, rubber stamps etc. Large items of equipment such as a computer, desk and chair come under capital allowances later.
· Postage – The Post Office will give you a receipt on request.
· Telephone calls – Unlikely to be allowed 100% so restrict claim to an approximate business percentage.
· Telephone rental charge – If half your calls are for business, claim half the rental charge against your tax. (Similarly, mobile phones.)
· Instrument insurance
· Instrument repairs
· Cleaning materials for instruments
· Instrument replacements – Strictly speaking, you should get a capital allowance for instruments but small inexpensive ones will usually just be allowed as an expense
· Laundry and dry cleaning – For your stage clothes only
· Music – All types, e.g. manuscript, sheet music, and arrangements
· Theatre tickets – HMRC will allow the cost of theatre and musical tickets for you only
· Advertising – e.g. Yellow Pages, ads for musicians’ work, second-hand instruments, Spotlight
· Publicity material – e.g. photographs, badges, posters, flyers. Don’t forget to claim the cost of the photo session
· Hire of rehearsal rooms, recording facilities and studios, musical instruments and other equipment.
· Car parking charges
· Commissions – Paid out to agents, managers, etc.
· Solicitors’ fees – e.g. for recovering debts, drawing up contracts
· Bad or doubtful debts – i.e. if you agree to do a gig but never get paid for it, after all reasonable attempts at recovery, your profit for that year is reduced by that amount, if you calculated income on an invoice, not cash basis
· Subscriptions to business magazines – e.g. Music Week, Guitarist etc.
· Bank Charges – Paid in connection with your business. These are easily calculated if you have a separate bank account.
· Interest charged on loans – e.g. for the purchase of equipment. You will need to get a ‘Certificate of Interest Paid’ from whoever you have borrowed the cash.
· Small consumable items – e.g. strings, reeds, drumsticks, valve oil, resin
· Contact lenses - Where required for reading music, although this may be challenged
· Some dental work – e.g. cosmetic or remedial (as with brass/woodwind players). Again this is likely to be challenged.
· Gifts advertising your services – e.g. pens, diaries, calendars, matches, etc. The cost of each must not exceed £50, as the whole amount will be disallowed. Gifts of food and drink are not deductible.
· CD/DVD/MP3 player – You may have to convince the taxman that you need to use these items of equipment “...for the purpose of trade....”, e.g. to learn new pieces of music. He will, however, almost certainly only allow you a part of the cost for business.
· CDs/DVDs/MP3s – Again, you will probably have to argue with the taxman over the allowable amount. Don’t be frightened to argue, but don’t be too greedy.
· Professional subscriptions – Annual subscriptions of a professional nature. (See later item referring to the Musicians’ Union.)
· Other inexpensive items of equipment – e.g. music stands, instrument stands and microphone stands. Expensive equipment comes under capital allowances later.
Wages – e.g. to road crew, secretary etc. If you start paying wages to anyone on more than a strictly freelance basis you are going to become involved with starting a full PAYE scheme and deducting tax and National Insurance contributions and so professional advice should be sought.
MU Subscriptions – allowable deduction?
A number of reports have been received of musicians who are self employed, and classed as such for HMRC purposes, having difficulties in off-setting their MU subscriptions against their taxable income. We understand that some local tax inspectors are quoting Section 343 ITEPA as the reason for this decision. This section is inappropriate, for whilst it severely restricts the fees and subscriptions that can be claimed, it relates only to employed persons taxable as employees. The employed person will need to show that it was necessary to incur this expenditure to carry on his/her employment. Self employed musicians are not covered by this category and should continue to claim their subscriptions as before, and will need to show that this expenditure was wholly and exclusively incurred for business use.