Kavanaghs List of Expenses 2014

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1 The team at Kavanaghs have compiled a detailed list of expenses which can be incurred by Music, Media & Entertainment Individuals in order to claim a tax deduction in your accounts. Revenue Expenditure Expenses which have been incurred on items / costs that have a life of less than a year. The Inspector of Taxes (HMRC) will allow revenue expenditure as a deduction from your freelance income when it is incurred wholly and exclusively for the purposes of your profession. An expense with both personal and business expenditure can still be claimed however we must ensure a correct split of the two parts is done and the intention incurring of the cost. This is an area that needs professional guidance. 1. Accountant s Fees 2. Advertising, publicity, brochures, photographs, business cards and flyers 3. Agent s commission and complimentary tickets 4. Auditions, competition, festival entry fees 5. Bad debts (included in turnover) 6. Bank charges, bank interest, credit card interest and foreign exchange 7. Books not retained for more than two years and library fees 8. Bulbs, fuses, locks, keys, plugs, cables, adaptors and minor repairs 9. Computer consumables including USB memory sticks, external hard drives (back up), software annual licence fee, tuition, repairs and service 10. Coaching and rehearsals for engagements in hand 11. Data protection registration and renewal fees 12. Dental work beyond normal needs of health 13. Deputies and accompanists (exclude deputies for an employment) 14. Dress-wear a. Hire of professional dress-wear b. Laundering and dry cleaning of professional dress-wear c. Replacement cost of professional dress-wear d. Specific gig dress-wear (at the behest of TV/ stage producer) e. Repair 15. Fees paid to colleagues where the engager has paid their fees via you (your freelance income will include the gross fee) 16. Heat and light - calculate business use on area occupied

2 17. Hire a. Business asset. b. Rehearsal studio, performance venue or tutor. c. Tapes/ DVDs d. Lighting, stands, scores etc 18. Hotel accommodation on tour 19. Instruments a. Insurance including part of contents policy, if appropriate b. Overhauling, tuning, repairs and maintenance c. Removal to another property d. Strings or reeds, resin for bows and other instrument components 20. Insurance including office and business property policies 21. Interest payable 22. Journals and catalogues 23. Legal costs including fee recovery and to fix contracts 24. Manuscript paper and nibs 25. Medical a. Alternative remedies including shiatsu, acupuncture etc. b. Chiropody c. Throat spray and lozenges d. Treatment for specific business purpose (no dual purpose) including osteopathy, physiotherapy 26. Microfilming and printing up rare music including digital archiving 27. Miscellaneous expenses - give a full description of each item and state why you are claiming it 28. Motoring expenses (include motor cycle and/ or car), keep a log of the total and business mileage for each vehicle so that the business element can be calculated:- a. Breakdown subscription/ insurance b. Car hire, petrol allowance to colleague(s) c. Car repairs, servicing, MOT, oils, antifreeze d. Motor insurance e. Parking at engagements, tolls and ferries f. Petrol g. Road fund licence h. You can alternatively claim 45p per business mile (encompassing all motoring expenses and capital allowances Kavanaghs can prepare a best outcome calculation to ensure you are claiming the correct amount) 29. Music for pupils, music for current engagements which you will not retain for more than two years 30. Newspapers and Music Reports (only to read reviews or seek work) 31. Orchestration, programme note writer, translational diary service 32. Page turners 33. Own property/studio - calculate business percentage on floor area:- a. Cleaning. b. Insurance. c. Redecorating studio d. Rent and rates. e. Repairs and maintenance. E: mail@kavanaghco.com [2] T: /

3 34. Photocopying and score binding 35. Porterage, carriage, securicor, removals 36. Postage 37. Private pupil s exam fees and prizes a. Exam fees and prizes b. Instruments and accessories c. Pupil s incentives d. Cost of concerts for pupils parents e. Stage props f. Refunds to pupils 38. Recording equipment a. Batteries for radio/ cassette recorder/ calculator/answerphone b. Blank tapes/ CDs/ DVD for rehearsal and tutoring c. Demo discs/ tapes including cost of engineer to record them. d. Memory cards e. Style and maintenance of hi-fi f. Headphones g. Repair of CD and DVD player 39. Records/ tapes/ CDs/ DVDs not retained for more than two years 40. Rent and rates of premises - calculate business percentage on floor area basis 41. Replace tour luggage and toiletries 42. Residential music festivals and conferences, diurnal seminars 43. Research assistance and material 44. Royalties to PRS etc. 45. Secretarial assistance including payments to spouse/ partner at the market rate for the work provided - to be paid through PAYE system 46. Software for your computer, web domain, registration and hosting fees 47. Stage appearance a. Contact lenses and spectacles, maintenance insurance thereof (you must have second set of lenses or spectacles that you use outside work) b. Fitness costs if relate specifically to role c. Hairdressing, cosmetics, beautician d. Make up and remover 48. Staff welfare including first aid, beverages and Christmas party 49. Stationery and printing including inkjet cartridges and toner, diary, waste bin and shredder 50. Subscriptions to professional bodies 51. Subsistence - you are allowed to claim the cost of all your meals when on overseas engagements. Only claim the cost of the evening meal when on tour in the UK and day time meals incurred on business travel 52. Television - if much of your work is on stage:- a. Licence fee b. Rental c. Repair E: mail@kavanaghco.com [3] T: /

4 53. Telephone:- a. Land line - request call transaction listing from the line provider to calculate business amounts b. Internet connection c. Mobile d. Coin box calls and overseas e. Accessories 54. Tips including tips to dressers, call boys, stage doorkeepers 55. Travel:- a. Bicycle repairs and maintenance, consumables and insurance - calculate the business use on a mileage basis b. Fares to the engager c. Fares to other than engager, e.g. music shops, libraries, auditions etc. d. Inoculations e. Travel insurance & cancellation fees f. Visas g. Excess baggage fees h. Maps, guides, timetables i. Passport extras 56. Visits to cinemas, concerts, opera, theatre, but only the cost of the ticket and only if akin to your repertoire, or to hear own pupils 57. Wages and salaries - to be paid through PAYE system 58. Wardrobe expenses - replacement and renewal of existing items (including shoes and towels) and props 59. Warranties e.g. PCs 60. Website design and maintenance, domain fee and cyber-cafes Capital Expenditure Expenses which have been incurred on items that have a life of more than a year. The Inspector of Taxes (HMRC) will allow a deduction from your taxable income in respect of your expenditure on 'Fixed Assets' namely the movable tangibles likely to last over two years that are used in your business. These are claimed as Capital Allowances on your self-assessment tax return. 1. Dedicated lighting 2. Bicycle 3. Books including music reference books 4. Camera, projector, screen 5. Carrying case 6. Computer and printer 7. Fax machine 8. Instrument and associated equipment 9. Know how / Goodwill (speak to Kavanaghs on this) 10. Legal costs on purchase of property 11. Metronome 12. Motorcycle 13. Motor vehicle including car and van E: mail@kavanaghco.com [4] T: /

5 14. Music shelving 15. Music stand 16. Office furnishings including carpets and curtains 17. Office furniture including desk, chair, filing cabinet and bookcase 18. Piano stool/ seating for playing instrument 19. Photocopier 20. Plant and machinery (equipment) 21. Property 22. Props 23. Recording and playing equipment including television (if much of your work is on stage), DVD, VCR, cassette recorder, hi-fi and music centre 24. Records, CDs/ DVDs and recorded tapes 25. Research and development 26. Scores and enduring music (lasts over two years) 27. Telephone including mobile phone Conclusion Having been Music, Media & Entertainment Specialists for over 25 years, Kavanaghs have gained extensive knowledge in tax deductible expenses as well as many other areas. Thinking of incorporating? We have extensive knowledge in the additional expenditure you can also claim in the Limited Company Entity which may be of interest? Should you wish to have a chat to us, or take up our offer of a free initial meeting, please get in touch! If you would like to discuss any of the expenses mentioned or are unsure if an expense is allowable please the office on call on / or us at mail@kavanaghco.com. We look forward to hearing from you! Please note, this is only a general guide and for specific advice on your personal circumstances please contact us. E: mail@kavanaghco.com [5] T: /

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