#1
Hi all,

Whats the best way to go about dealing with payment from a venue? As a business, they obviously have to account for the expense of hiring us, so an invoice is needed. For us to do that, we need an ABN (business number).

Should I:

1: apply for an ABN and invoice them directly in my name; or

2: register the band as a business and include all members as a part of said business. As far as I'm aware, we could write-off equipment expenses in our tax return.

I don't know the ins and outs of it and I could very well have my facts wrong. I just want to find out what all of you do/have done in this instance.
#2
I would say register the band as a business.

Is it really necessary to have a bank account though? I think it works better to just give gas money to the driver, then put the rest in a band fund. Basically, let the manager/trusted person in the band handle the finances.

Getting a band bank/business account doesn't seem worth it, unless you guys pull in a lot of money and have a bunch of expenses.
#3
We wouldn't be creating a bank account, just a business number so we can invoice the pub/bar. We still get paid cash in hand and the amount after expenses is divided equally amongst band members.

I've booked an appointment with an accountant to get some professional advice, I just wanted to see what the rest of you do. I get the impression that most of you guys just get paid cash off the books (that would be so much easier).
#4
I don't get why you'd need an ABN to recieve payment from a business. They can just as easily transfer money into your private account, just as they pay their employees. To write something off you can still do this if you show that it is an income source. Note that you will then be taxed if it's not off-the-books.
And no, Guitar Hero will not help. Even on expert. Really.
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#5
Hmm, it's the tax that I'm concerned about. If I can off-set expenses such as PA hire, its should be a problem, just an inconvenience.

Well if this isn't the norm I'll scout around at other places to see how they pay their entertainment.
#7
Quote by jazz71286
Hmm, it's the tax that I'm concerned about. If I can off-set expenses such as PA hire, its should be a problem, just an inconvenience.

Well if this isn't the norm I'll scout around at other places to see how they pay their entertainment.


If you can make a regular income as a band, you are allowed to offset the expenses against that income. It's just like any job.
And no, Guitar Hero will not help. Even on expert. Really.
Soundcloud
#8
Good idea about making an appointment with an accountant for professional advice.

Keep in mind that if you register the band as a business, then the business claims the income and the business writes off expenses against it. If there is a balance owing or a tax refund at the end, it goes to the business. That being the case, you have to do things properly to ensure that everything (money in and money out) can be tracked to the business. If you buy a guitar, and pay for it out of band money, it belongs to the band. Now.... what if the band splits up? It can get complicated.

The advantage of each member being an independent contractor who works together towards this project (imagine a plumber, bricklayer, electrician, etc. all working together to build a house.... none of them own it, they just work on it together ) means that you, as a musician, can buy that guitar and claim it against your income. When the band breaks up, it is still yours. But if you choose to sell it, that price should be included as income. The other advantage is this: If you can find a way to show that your musical ventures operate at a loss (your expenses and deductions are greater than your income), this net loss can be applied to your other personal income, lowering your amount of personal tax payable. Nice.

If I were you, I would go the personal route until such time as the band is a large enough - and a relatively secure enough - entity to warrant doing it that way. FWIW, here in Canada, the basic personal tax exemption is around $8000, I think. If you make less than that, you don't pay any tax. It is also hard to get a refund at that level too, though, because at that level, with that little income, you can't possibly have that many expenses. If a band business exemption is somewhere around there, does your band make enough per year to meet the basic tax exemption limit? If not, it is probably almost certainly not worth it to do a separate tax return for the band.

Most venues and promoters pay cash, or will write you a personal cheque. You don't need to invoice anyone. In fact, most of the 'ground level' people wouldn't know what to do if they got an invoice from a band.

CT
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#9
Quote by axemanchris
Most venues and promoters pay cash, or will write you a personal cheque. You don't need to invoice anyone. In fact, most of the 'ground level' people wouldn't know what to do if they got an invoice from a band.


This man speaks the truth. In all honestly if you start requesting "paperwork" from venues they may decide to replace you with a different band that will just take the cash "under the table" instead just to avoid the hassle.
#10
Quote by Erkekjetter
This man speaks the truth. In all honestly if you start requesting "paperwork" from venues they may decide to replace you with a different band that will just take the cash "under the table" instead just to avoid the hassle.

/agreed

(Around here) it's often just the cover charged at the door divided by the groups playing, no set rates. In the ends its cash.
#11
Quote by Erkekjetter
This man speaks the truth. In all honestly if you start requesting "paperwork" from venues they may decide to replace you with a different band that will just take the cash "under the table" instead just to avoid the hassle.


Believe me, I would take the cash under the table any day of the week, but the venue we're playing at is requesting invoices and an ABN.

Thanks CT, your post answered a lot of my questions (even the ones I haven't asked yet!).

I'll speak to an accountant to find out whats easier/how to manage it.