This is day 13 of our Tax & Accounting at Christmas Special, as we analyse the tax and accounting treatments of all things Festive and open a door in our Christmas Advent calendar to count down each working day until the Christmas holidays in the UK. 

Christmas may well have originated in the celebration of the Winter Solstice: a time of feasting and dancing. This time we look at tax and accounting for dancers.

The Dancer

  • A dancer may be employed or self employed for tax purposes.
  • Employment Status is determined according to the terms of your engagement. 

Accounting

Tax

  • If employed, your income will be subject to PAYE and you will be fairly limited in the type of expenses you may be able to claim to offset your income.
  • If self employed your profit is calculated according to the accounting method chosen.

Expenses if you are self employed:

  • Expenses must be incurred Wholly and exclusively for the purpose of business to be deductible for tax purposes.
  • Private use adjustments will be required if any expenses are incurred for both private and business purposes: however only if they can be apportioned.
  • The type of costs that can be claimed may partly depend on whether you are claiming Flat (fixed rate) deductions or Actual costs.

Difficult areas:

Special expenses

  • The physical demands of the job can lead to physical injury, the cost of Medical procedures and treatment are not normally allowed for tax. There may be exceptions depending on the circumstances. i.e. the cost of emergency treatment of an injury to allow you to go on stage and not miss tonight's show is likely to be allowable, while the cost of an operation to correct a another injury may not be as it will be of long term benefit to you as an individual.
  • The cost of Clothing & Workwear including theatrical costumes, special hairdressing and manicures are normally allowed for tax provided that the costs are incurred for the purpose of the performance. 

Travel

  • Travelling expenses are allowed for the costs of business journeys, e.g. to attend rehearsals and auditions, or to visit your accountant.
  • Travelling costs to and from home and any fixed or permanent or regular workplace are not usually allowed. This follows case law. The type of journey where travel might be disallowed would be the journey from home to a regular dancing venue or theatre.
  • The cost of travel to perform in a Christmas show or panto would normally be allowed unless the venue is one where you regularly work..

Assets used by the business

  • Capital allowances are available for the cost of a vehicle and any equipment such as a PC, mobile phone or tablet required to run the business. If you run an office, the costs of your office furniture and equipment will be allowed.
  • Private use adjustments will be required for assets that are also used privately.

Difficult areas:

Trading allowance: small scale activities

  • If your income from performing does not exceed the £1,000, you can claim the Trading Allowance there is no need to register for Self Assessment and declare or pay tax on that income.
  • If your income exceeds the allowance, you must register for Self Assessment and you may elect to deduct the £1,000 allowance instead of claiming tax relief for allowable expenditure.

 Useful guides

What expenses can I claim? A to Z of different trades & professions

Dancers & Physical Performers

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