Tax Introduction

Artists and craftspeople, like any other person living and working in the UK, have to ensure they pay the correct amount of tax on their earnings. For people in employment – full or part time – tax will be deducted by their employers (called ‘deducted at source’ or PAYE – pay as you earn), and if this is the only income you have you should ordinarily not have to pay more tax on earnings. Tax is also deducted from UK bank accounts and savings accounts – for more information see the website of Her Majesty’s Revenue and Customs (HMRC; formerly Inland Revenue) who are the government department dealing with tax and customs in the UK.

The UK tax system is very complex, in common with other tax systems around the world. It is possible to pay too much tax as well, and with limited resources HMRC are unlikely to correct these mistakes themselves. It is every employee’s responsibility to make sure their tax is being paid properly, and you can be liable to fines if you do not pay the correct amount (naturally, you’d be unlikely to be fined for paying too much tax).

Many artists have an accountant who can fill in and calculate their tax payments for the year; accountants can also submit tax returns to HMRC and answer questions they may have. Many practitioners also fill in their own tax return themselves, and there are extensive notes on the HMRC website about how to do this, plus helplines and other free online help sites to contact if you are considering filling in your own tax return. Accountants fees, like other professional fees to support your practice (or business) can be offset against your income and lessen your tax burden.

The rest of this section goes in to more detail about tax, accountants and how to ensure you are working within the law – including how to register as self employed and a discussion about whether or not this is the right step for you. Paying tax is a legal imperative in the UK, and you face stiff penalties if you do not.

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