United Kingdom

Hey guys, this is my first post here so I'll begin by saying 'hello'.

Hello, my name is Josh, I'm 24 and am looking to form a thrash/ punk crossover band in Leeds (or Derby if my relocation plans fall through).

Now that's over I'd like to share an idea I had for any bands out there:

Most bands out there are legally business partnerships, the way tax works for partnerships is that any profit made by the partnership is assumed to be distributed according to the share of the business and it is the individual who is reponsible for paying tax on the income.

Now most bands do not make profit (at least in their early years), leaving the partners (band members) out of pocket. I may be wrong about this, but I think it may be possible to claim these losses on your tax statement and get a rebate.

To give an example:

If a band pays ?30 a week for it's practice space, and spends ?1500 on recording (roughly 7 days). Then that amounts to roughly ?3000 spent on business expenses in a year, or in a 3 piece band ?1000 each. Assuming no income from gigs, merchandise etc (as it would complicate the maths and isn't necessary for my example), then each member would have made a loss of ?1000 from the partnership in that year.

I think it may be possible to claim back any tax paid on that loss (~?200). This effectively raises your tax exempt earnings by the amount of money that you sink into your band each year.

Now I'm not an accountant and I can't find the information to confirm this online, but I think it's correct.

Can anybody confirm or deny this for me? Anyone tried this? Let me know what you think.

Cheers

Hey guys, this is my first post here so I'll begin by saying 'hello'.

Hello, my name is Josh, I'm 24 and am looking to form a thrash/ punk crossover band in Leeds (or Derby if my relocation plans fall through).

Now that's over I'd like to share an idea I had for any bands out there:

Most bands out there are legally business partnerships, the way tax works for partnerships is that any profit made by the partnership is assumed to be distributed according to the share of the business and it is the individual who is reponsible for paying tax on the income.

Now most bands do not make profit (at least in their early years), leaving the partners (band members) out of pocket. I may be wrong about this, but I think it may be possible to claim these losses on your tax statement and get a rebate.

To give an example:

If a band pays ?30 a week for it's practice space, and spends ?1500 on recording (roughly 7 days). Then that amounts to roughly ?3000 spent on business expenses in a year, or in a 3 piece band ?1000 each. Assuming no income from gigs, merchandise etc (as it would complicate the maths and isn't necessary for my example), then each member would have made a loss of ?1000 from the partnership in that year.

I think it may be possible to claim back any tax paid on that loss (~?200). This effectively raises your tax exempt earnings by the amount of money that you sink into your band each year.

Now I'm not an accountant and I can't find the information to confirm this online, but I think it's correct.

Can anybody confirm or deny this for me? Anyone tried this? Let me know what you think.

Cheers

Hard to say how it works in UK, since I don't work and live there... but In the US, if you register your band's name and file it as a limited liability corporation (Or you simple create a Communications Firm and incorporate it, using your band as hired employees, you can write off the expenses of the band through the firm, but you still have to pay your respective income taxes... The good news is that as a band member, your corp pays you so ridiculously little in wages that there is no money owed by you in income tax at end of year... (according to your scales) ... The Corp can then pay out bonuses to the members each year (which have to be reported...but its a loss for the Corp; a gain for the members and a wash on the taxes with respect to the corp)...

Now I could be wrong... cause the rules keep changing in the U.S....so forgive me..if it leads to inacuracies

To Whom It May Concern,

I posted a message to a duplicate of this thread prior to realizing it was a duplicate. In any case, that message gave some very specific accounting advice as concerns the OP, and took me nearly an hour to compose.

If that thread has been moved to, "Trash," as opposed to outright deleted, I would be most appreciative if my lengthly post could be ported to this thread. I understand that if the duplicate has been deleted, then nothing can be done, but would respectfully advise the Moderators, for future reference, to take appropriate action concerning duplicate threads in which there has been a reply.

I appreciate your kind attention to this matter.

Respectfully Yours,
Pierce G.