Tax Tip: Travel expenses for artists

Reader's question #1: Are taxes the same for all income - and what about travel expenses?

Two questions from a reader:

1. Are taxes the same for all different sources of income?
2. Can I deduct my travel expenses from my income before tax?

Read on to find out my opinion on the questions asked (and don't forget to read the note at the end)

Reading through articles about taxes for artists, they all assume that the primary income comes from the sale of art (paintings, etc.)

Are taxes the same when the primary income is freelance teaching (as a Teaching Artist)?

​For example, may I deduct my mileage to and from individual teaching stints at art centers where I teach children?

Are taxes the same for all different sources of income?

In the UK, the answer is ALL INCOME is liable to tax assessment - no matter how you earn it.

In fact, my P60 (for my pension) has a neat quote in it which I've added into the HMRC section of Tax Tips for Artists.

By law you are required to tell HM Revenue & Customs about any income that is not fully taxed, even if you are not sent a tax return.

Can I deduct my travel expenses from my income before tax?

Whether you can claim travel expenses depends on how you earn your income

You may not be aware but many artists do NOT just earn income from sales of their paintings.

Very many professional artists who also teach earn income:

• EITHER through a full or part-time job as an art teacher (i.e. they have a contract of employment; they are an employee of a school/college/university who pays them a salary and deducts tax and NI at source).
• OR their services are hired by an education provide on a sessional basis for a fee r (i.e. there is no contract of employment - hire is on a 'session by session' basis only).
• OR they run their own independent workshops and courses.

​
The issue of whether or not you can claim travel expenses relates to whether or not you are a sole trader and wholly responsible for all your actions.

So for example, (in the UK) if you are an employee with a contract of employment and what you do is dictated by others (eg you teach a set curriculum); you are managed and assessed as to competence by others and paid on a monthly basis - then you can't claim home to work travel expenses.

That's because you are the same as every other employee in the UK - and employees can't claim home to work (and back again) expenses as a business expense.

However if you are completely freelance and have a number of different people who hire you to teach art and/or you deliver your own workshops at different venues you hire around the country - then you are self-employed and you can then claim your travel expenses.

Basic principles: you can only claim travel expenses:

• when self-employed AND
  
• for journeys wholly and ​exclusively for business purposes.

EXAMPLES: 

• If you're employed by a school as an art teacher, you will have one designated work base and cannot claim travel expenses to and from where you teach by way of a tax deduction.
• If your school requires you to work peripatically on different sites, you can claim travel expenses from the school for trips away from your designated work base. You cannot claim travel as a tax expense. 
• If you're employed part-time as an art teacher, you can also choose to deliver an independent workshop in a venue of your choice. In these circumstances you cannot claim travel expenses for your contract of employment as a part-time teacher BUT you can claim your travel expenses from home to the venue where you deliver an independent workshop. However you must also then complete a set of basic accounts and the self-employment part of the self-assessment return.
• You deliver workshops all over the country and have no contract of employment. You can charge your travel expenses as a deductible expense according to the rules defined by HMRC. If you don't use public transport, it's often useful to use the HMRC approved mileage rate for the number of miles you do per annum.

Note: This article is intended to be for general information and is should not be relied on as definitive tax advice.  It's your responsibility to check the rules for the country where you live and work and the relevant tax year. The tax rules may be similar or they may be different.