Hey James,
Ignore all the out-of-townie-experts and listen to someone who have been through the British Tax meat-grinder (and still is enjoying it) 😉
One disclaimer to my opinion below: If in doubt get an accountant, although such can be expensive they are to spare you from fines, jail and paying too much tax!
Are you a registered self employed person with the HMRC?
Do you invoice multiple clients for your services? (If you only have one client, they must pay you PAYE and offer you things like holiday pay and pension)
Do you pay your own National Insurance?
Do you file your own income accounts?
Provided that you are a professional working in the business of making videos and films, there are a number of things that you can legally claim expenses on for production purposes. Such as R&D, phone calls, insurance, transport, hire of equipment, asset purchases etc. Any expense that you can prove was for the purpose of making films for business and not hobby. Just make sure to have the argument for the expense, before showing HMRC the video of your best friends wedding…
(Example: I once managed to claim tax back on a Playstation 2 – I also had a lengthy report to show how I had taken part in a research project for developing new software and hardware for it)
Although crew and actors are an expense too, I did not include those in the above list as it could be a minefield – like your customers, those people you engage to work for you, may suddenly become your employee. So be careful on that point as to who you hire and for how long. Websites like https://simply-docs.co.uk/Home are a cost effective way of getting legal forms/contracts to be modified and signed by you and your freelancers.
(Not many people knows this, but the UK employment laws are amongst the toughest in the world. Even tougher than those in places like Denmark (my home country :-)))
As a closer. In any case, you said it yourself:
[James Quinn] “Consider that the films I make are made with the purpose of hands-on-training and a form of advertising for my skills, can the money I spend on their production be counted as losses in my tax returns?”
In the UK tax system it is unlikely that a sole-trader can claim back on training and university courses unless you can prove that these are necessary for a specific project. However, it is possible to claim back some marketing and advertising expenses if those are to help you promote the business.
If in doubt, ask an accountant. Who may suggest that you set up a Limited company to protect yourself. (Do NOT do that unless you have turnover of £45K+ a year and/or very complex productions)
You could also consider signing up for an accounts package that will ask you to separate out personal and business expenses. I migrated from Quickbooks (off-line) to Freeagent (online) which is really good for managing my mixture of personal, PAYE and self-employed accounts – my referral link for it is here: https://fre.ag/42m3rdrm
Good Luck and don’t hesitate to ask if there was anything that I didn’t cover.
All the Best
Mads
@madsvid, London, UK
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Twitter: @madsvid
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