Invoices

hotpickups

Just wanted to ask how you guys deal with getting paid at venues. I ask because sometimes I get asked to invoice. Do you guys set up a band account and submit tax returns each year? I'm not talking about bands that go out as a business but small local pub bands like us who do the occasional private gig. 

simonk

Sounds like a lot of invoicing. We do some agency work - I invoice them on behalf of the band and supply my personal bank details, then divvy it up once it's been paid.
I've not had a pub/club ask me to invoice them yet... they normally just ask me to sign something on the night, then hand over the readies.

hotpickups

Sign something yes but this pub wanted to include on the paper band name, contact number, address and all. Which means that who ever signs it is traceable for tax etc.  FFS it's supposed to be for fun

Sporky

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

hotpickups

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

Of course but when one does a real cheapo pub gig and all the effort that goes into it one would think a cash payment would be ok on occasions. Just going to have to increase the band fee to accommodate the tax part that's all . Just a bit pointless it seems sometimes as the charge just gets knocked on  

RiftAmps

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

Yup, a local 'pub and beer festival' band just got a beat-down from HMRC for not declaring income.

hotpickups

RiftAmps said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

Yup, a local 'pub and beer festival' band just got a beat-down from HMRC for not declaring income.

Lucky we haven't been busy this year then apart from a few freeo gigs . Gonna make sure I'll be putting any paid gigs on my self assessment form I get in the future. My share of it anyway 

hotpickups

I wonder how the HMRC work it out though if there are no invoices or receipts? Or is it a fine ?

Roland

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

A lot of us can demonstrate that our band costs are greater than our income from music. Rehearsal room costs, travel to rehearsals and gigs, and a proportion of equipment and consumables, exceed my band income.

hotpickups

Roland said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

A lot of us can demonstrate that our band costs are greater than our income from music. Rehearsal room costs, travel to rehearsals and gigs, and a proportion of equipment and consumables, exceed my band income.

lol ain't that true. I don't even want to think about what I've actually spent

RiftAmps

I think it's a fine.

In this case, the bass player was issuing an invoice in order to get paid, but then didn't declare the income. They were quite unlucky as the pub that was hiring them (on a regular basis) was under audit, the inspectors just followed the money and said "why haven't you declared the £3500ish in gig fees?".

hotpickups

RiftAmps said:

I think it's a fine.

In this case, the bass player was issuing an invoice in order to get paid, but then didn't declare the income. They were quite unlucky as the pub that was hiring them (on a regular basis) was under audit, the inspectors just followed the money and said "why haven't you declared the £3500ish in gig fees?".

Ouch I can just see the discussion in the rehearsal room asking for everyone to chip in to pay that

Sporky

Roland said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

A lot of us can demonstrate that our band costs are greater than our income from music. Rehearsal room costs, travel to rehearsals and gigs, and a proportion of equipment and consumables, exceed my band income.

That's a fair point - I should have said "doing the tax" or similar. But you do need to be able to prove  it.

hotpickups

I keep all my receipts. Just a habit I've always kept up thankfully 

TheBigDipper

hotpickups said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

Of course but when one does a real cheapo pub gig and all the effort that goes into it one would think a cash payment would be ok on occasions. Just going to have to increase the band fee to accommodate the tax part that's all . Just a bit pointless it seems sometimes as the charge just gets knocked on  

It's not hard to start up a "business" as a sole trader musician. If you're a four-piece, you get 25% of all the bands income as your personal income to your "business". Then, as expenses, you claim for mileage travelling to gigs and rehearsals, for supplies that need replacing such as strings, to buy the equipment you need in the first place to do this thing, etc., etc.  It won't be hard to make a loss that means you don't have any extra tax to pay. 

hotpickups

TheBigDipper said:

hotpickups said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

Of course but when one does a real cheapo pub gig and all the effort that goes into it one would think a cash payment would be ok on occasions. Just going to have to increase the band fee to accommodate the tax part that's all . Just a bit pointless it seems sometimes as the charge just gets knocked on  

It's not hard to start up a "business" as a sole trader musician. If you're a four-piece, you get 25% of all the bands income as your personal income to your "business". Then, as expenses, you claim for mileage travelling to gigs and rehearsals, for supplies that need replacing such as strings, to buy the equipment you need in the first place to do this thing, etc., etc.  It won't be hard to make a loss that means you don't have any extra tax to pay. 

I could be wrong but you could only do this for 5 years. After that the HMRC writes the company off. Is this correct ?

Moe_Zambeek

I asked HMRC about this for my band, and when they heard the ballpark numbers they told me not to bother declaring it. That was poorly / barely paid originals though, 3500 would have been 10 years work, and before expenses at that!

Maybe things are different now though, that was a few years back.

hotpickups

Moe_Zambeek said:

I asked HMRC about this for my band, and when they heard the ballpark numbers they told me not to bother declaring it. That was poorly / barely paid originals though, 3500 would have been 10 years work, and before expenses at that!

Maybe things are different now though, that was a few years back.

Not that different, that's all we would get if we got paid in my area Its the private gigs we want which are also pretty few of them we see. Pub gigs we think of as a loss lead. We're doing something wrong

simonk

Roland said:

Sporky said:

If you're not paying tax on it you're asking for a brutal reaming from HMRC.

A lot of us can demonstrate that our band costs are greater than our income from music. Rehearsal room costs, travel to rehearsals and gigs, and a proportion of equipment and consumables, exceed my band income.

Absolutely! I declare everything... it can be a bit of a ball ache recording mileages and stuff but it all helps towards proving, certainly in my case, that I make a sizeable loss.

Sporky

As my accountant once said after going over monkeyFX - "If you can find a tool or book costing you about £40 in the next couple of weeks then your hobby has cost you nothing this year. I am sure we can continue on a similar basis for the foreseeable future."

I have a lot of receipts for the new workshop, so that'll cover (at current rates) any sales by monkeyFX Guitars until the heat-death of the universe.

sw67

I keep a note of all my gigs and how much i earned. I then make sure i spend more than that on the kit i need every year. I was told that its fine as long as its a paying hobby.