*I am not a tax professional. This is meant to be an educational tool and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
One of the coolest things about life as an artist is that you’re forced to always be learning.
Something you won’t hear very often…
“Today I learned all the Art… I guess that’s done with…”
Actors, dancers, musicians… are constantly studying not matter what level they’re at. Working with teachers, private coachings, doing classes and looking for anything to help them grow as an artist.
What a beautiful thing.
But how do we translate that really nice thought into black and white numbers at tax time?
How to find your ‘professional development deduction’ when everything you do seems like professional development….
In my life there are some clear and indisputable development costs.
- Voice lessons
- Music coachings
- Acting classes
I’m clearly spending money on structured activities in order to get better at what I do (and hopefully get some work).
In my mind I could give a good argument to any auditor on the value of those business expenses.
But what about these:
- Movies tickets
- Concert tickets
- A month long trip to France to look through sculpture museums
Those are some murky waters.
I bet there are some people who look at those last 3 things and don’t see anything wrong with that list, and some who can’t believe that people might claim those as legit business expenses.
So who’s right?
The reason the rules aren’t black and white…
It’s not simple.
Every business is different, and so it’s not about trying to find a hard and fast rule and applying it.
You need to look to your specific industry. Your own specific business. And ask a few questions:
- is this expense going to help me make money?
- is this expense necessary for my business?
- can I justify it to someone who’s not in my industry in just a few sentences?
If you answered ‘no’ to any of these maybe it’s not worth the risk. Or maybe you should just check it with your accountant and see what they think.
Here’s how I’ve been thinking of it…
This is NOT something that’s backed up by the tax code, but it’s where I’ve landed after thinking a lot about the word ‘reasonable’ (a word they use like 50 times a page on the CRA website).
There are so many things I do to ‘develop’ as an artist. I watch movies, I read plays (or at least I started one last week), I see shows.
But a lot of that I would do even if I wasn’t a working artist.
I love movies, and Netflix, and live theatre.
So if I’m working on a specific role which is inspired by a movie. I might use that as a business expense.
If I go to the opera to help research a role I’ve been working on. I might claim that.
But no matter how much I learn about acting from Kevin Spacey by watching House of Cards… I don’t consider Netflix a business expense.
I know other artists feel differently… but that’s where I’ve landed.