Business Tax Tips
let's talk about everyone's favorite subject taxes. So I know I briefly mentioned it in the previous lesson about saving for taxes, but taxes are a part of everyone's life, especially people who have and run their own businesses, We keep mentioning this, but depending on where you live, your state, your city, your country taxes are going to look different for everyone. The percentage that's collected when it's collected, how you make those payments. Again, it's going to be different. So it's important to find an accountant who can help you with this in your local area to talk to other photographers in your area to see how it works for them. If you're just getting started, The main thing to understand is that you have to pay taxes on any income that you make. So it's a good idea to estimate what percentage you need to save so that you can keep that in your bank account or even a separate bank account so that you can make those payments from that account and not have to worry about where...
you're gonna come up with the money for paying your taxes. Do not fall into the trap of not knowing how much you owe and spending all your money that you're making. Because if you're running a legitimate business, you need to be paying taxes and know how much you owe. Another thing that will mentioned briefly in the last section was sales tax. This is again gonna change depending on what region you're in, what kinds of things you're selling. But if you're selling things like physical goods, if you're selling at the local market Prince, you might have to charge sales tax that go to your local government to your state. So again, something you have to look into and you add that sales tax on the top of any prices you charge and you have to save that money and send it back to the government with taxes. I also want to just mention that the good thing is that if you have expenses as a business, those are usually tax deductible. So things to keep in mind are of course your equipment. So if you're buying a new camera gear, this is gonna be deductible if you're running an actual photo business, travel costs such as mileage or lodging. If you have to stay somewhere that's also going to be deductible meals depending on what it's for during a shoot partially can be deducted as well. Again, going to be different wherever you live though. Also, if you have a home based office, some of your home office expenses can be deducted. Generally things like your internet or even your other utilities, electricity, water, those things can be partially deducted if you are working from home. It's important though to talk to an accountant to find out what is actually available to be deducted in your area. one thing you should consider though is because you might have to pay a lot of taxes on the income is should you be paying that in taxes or maybe is it a good idea to invest that? Reinvest it in your business with things like better equipment or bulking up your website, advertising, promotional costs, those kinds of things. This is something that maybe at the end of the year and you look back and see how much you've made and see if you've had enough expenses or what your taxes are going to look like and you have to make that judgment call on if it will be better for you to reinvest in your business or not. So that's a little bit about taxes. I know it's not the best subject that everyone likes to talk about and again, talk to an accountant in your area to help you out with your own situation.