Many Creators may have heard fantastical tales of something that can save them from paying a bucketload more tax at the end of the financial year... expenses. But not everyone is completely clued in on what they actually and can't claim!
Luckily Sam Uwins, Accountant for Social Influencers and Online Content Creators at MHA Carpenter Box, has the lowdown on what you need to know...
How do expenses help lower my tax bill?
A Creator is only required to pay tax on the profit that the business makes, rather than purely the income. This involves offsetting any expenses that the business has occurred during the year.
This could include travel costs, production costs, props that have been purchased for the purpose of creating content. All of those costs can be offset against your income in order to calculate your profit, before you calculate the tax that will be deducted.
What requirements must Creators fulfil before doing this?
A Creator is required to register with HMRC. They will then be issued with a UTR number, which confirms HMRC have them registered as self-employed. Once you're registered as self-employed, you will be required to prepare a tax return once per year. On this tax return you will be required to submit information of your income and expenses, which will include details of the expenses that you are looking to claim