Tax
Are You a YouTube Performing Artist for Income Purposes
Did you know there maybe tax consequences for people who generate income from YouTube?
If you are thinking of giving up your current job and making a living from YouTube make sure you talk to a your tax accountant before taking the step.
There is a difference between income derived from a hobby and income derived from carrying on a business and generating income from that business which is taxable. Referring to the Australian Taxation Office – ATO ID 2014/41, people who earn income from YouTube will be treated as “performing artist for income purposes”.
The Facts as presented in this Interpretative Decision are as follows:
“The taxpayer carries on a business of creating cooking and baking videos for upload onto YouTube.
The taxpayer produces, designs, edits, scripts, voices over, films and acts as presenter in the videos for the purpose of up loading onto YouTube.
The taxpayer receives income from Google for their YouTube videos based on a share of advertising revenue and the number of views their videos receive.”
It is important to mention that, if you are deemed to be a performing artist then you could be eligible for income-averaging concessions if you had unusually high income in a particular year.
What you need to keep in mind in today’s world is that income from this source can grow quickly if your productions suddenly takeoff and you become a hit. I have clients who take up hobbies that often never become anything other than a hobby, but with the advent of YouTube and other forms of electronic media the capacity to turn into an overnight sensation has increased significantly over recent years.
If you are serious about going down the road of producing YouTube videos or the like (for income) make sure you seek professional advice before you go down this path. If you do not seek the appropriate advice then you may find yourself facing significant tax liabilities. It is not all bad news though because of the income-averaging concessions available as mentioned earlier.
Balanix Solutions is more than happy to provide guidance if going down this road is where you see your future. Like all business adventures success is based upon good planning and strategies and not managing bush fires once they are raging.
David Balwin
FCPA | Registered Tax Agent | Business Advisor
Balanix Solutions – Registered Tax Agent, Accountant, Business Advisor, Bookkeeping.
Situated in Strathpine on Brisbane North, we partner with our clients to assist them in their accounting, business management and bookkeeping needs. Our clients vary in industries from professional services (such as law, vet and dentist) to the trades (mechanic, bricklaying, plasterer etc), hospitality and retail. Are clients are located in the Pine Rivers area (including Brendale, Lawnton, Albany Creek and Eatons Hill) through to Kallangur, Petrie, North Lakes and Caboolture, as well as Brisbane South, the Gold Coast and various other parts of Queensland.
8 Bad Money Habits to Kick – Final 2
David Balwin
CPA | Accountant | Business Advisor
Welcome to the final blog in which we look at 8 money habits business owners should make sure are NOT occurring in their business.
Funding Tax liabilities at the last moment.
All business owners are certain of two things …. Cashflow will have ebbs and flows and there is always a tax liability in some shape or form.
Depending on the nature and size of the business various tax obligations and liabilities may apply. There is company tax, goods and services tax (GST), payroll tax to name but a few.
Unfortunately, some business do not plan for these liabilities and find themselves stressed and unsure where to find the money when the taxman comes knocking.
Like all good business practices, plan the business’s tax obligations and set up a process of putting the money away on an ongoing basis so it is there when payment is due. If need be, set up specific bank accounts for GST and long term liabilities so the money goes out of sight thereby reducing risk of spending by accident.
Saving what’s left after paying everyone else.
Debts have to be paid. Businesses need to establish good credit profiles in order to maintain good suppliers and financial arrangements. With cashflow in and required cashflow out not always dancing in harmony, business owners need to save along the way to ensure adequate funds when needed. Set a percentage of income to be saved on a regular basis and don’t rely on scraps if and when there maybe some. Also, manage the payment of bills ensuring they are paid on time but not necessarily the minute they come through the door. Budgeting and forecasting is another tool to stay on top of cashflow and the financial health of the business.
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