A Tax Guide for Actors and Entertainers

A tax guide for actors and entertainers may not be the first thing that comes to mind for those working in the industry. However, it is important to make sure you stay up to date when it comes to your tax and accounting. Many people working in the profession end up in complicated situations. The assistance of an accountant can help to ensure that you only pay the correct amount of tax you ought to.

If you are looking for an accountant to assist with your tax or filing of annual accounts, please get in touch with Alexander & Co. As an equity-approved and recommended firm, we have significant experience working across the sector, providing specialist tax advice.

Are Actors Considered Self Employed?

If you are an independent actor or entertainer, it is likely that you would fall under the category of self-employed as a sole trader. In this scenario, it is essential that you keep accurate records. It’s important to keep a record of both your earnings and your expenses.

Different types of earnings for self-employed actors

Taxes can get complex as an actor or entertainer because you’re likely to end up with multiple different income streams. For example, it may be the case that you:

• Earn through employed work – If you are put on a contract to work on residency or for a longer production period, you will be paid normally and should receive a P60. However, this will affect your tax free income from self employment.
• Generate self-employed income – With acting and entertaining, you will likely send invoices so you can be paid. You must keep track of these and keep them on file.
• Other types of income – you might get foreign income if you end up working abroad. You may also earn income from other sources, such as property or crypto.

If you are reaching the point where you have several successful income streams, it may be beneficial to speak to an accountant. It can get confusing to keep track of all of your income streams, but an accountant can help you keep track so you can pay the correct amount of tax and claim all available relief.

Expenses for Self Employed Actors and Entertainers

There will likely be many outlays that are potentially tax-deductible, and you should take a careful note of these in order to take full advantage.

You can claim expenses incurred for business purposes that are “wholly and exclusively”. Every business is different and the types of expenses entertainers and actors will claim vary. Ultimately, expenses can be claimed on items that are solely for the purpose of your entertainment work. These can also be services such as agents and managers, accountants and advertising agencies.

Examples of expenses you might claim 

The fees you pay to a manager or agent can count as expenses, as can any commission you pay them on top of the usual fees. If you are going away on tour, reasonable travel and living expenses may come into play, as well as any props, stage equipment or costumes you might have to purchase to perform. Cleaning and laundry of any of these items that you use as part of a performance can also fall under the expense bracket.

Charges from your accountancy firms can be considered expenses, as can charges on any business accounts that might be in your name. If you have a mobile telephone account that you use for business, this too can be on the list of items you can expect to claim expenses on (although you cannot claim for personal calls).

Be aware that some expenses are counted as ‘dual purpose’ – i.e. they are used for both personal and business activities. In this case, you are usually only permitted to claim expenses on the business share of such items of services, and will be expected to provide proof.

The golden rule is to keep a record of all your expenses before you sit down to ascertain which might be tax-deductible. This will greatly assist when it comes to filling out your tax return.

Key dates for actors and entertainers

If you’re an actor or entertainer, there are a few key dates you should be aware of including the self assessment deadline. Each year, you will need to report your earnings to HMRC. Find our full list of important tax dates for the 23/24 year to ensure you don’t miss anything that applies to your situation. 

 If you’re confused about the key dates and need assistance, engage with the services of an accountant.

Speak to Alexander & Co about your accounting and tax

Alexander & Co can assist  if you are an actor or work in the entertainment industry. As an Equity approved and recommended firm, we have significant experience working industry wide. If you are looking to work with an accountant as an actor or entertainer, get in touch with our experienced team today.