Building on the success of recent years, the new project phase (Getting Down to Business through Recession and Beyond, 2012-14) is supported by funds from unionlearn (the learning arm of the Trade Union Congress).

The project has several objectives all focused on facilitating freelance skills development. These include:

• Addressing skills gaps by developing a blended-learning programme including classroom-based training and e-learning facilities
• Helping to overcome freelance barriers to learning including accessibility, affordability and relevancy.
• Continuing to develop our digital platforms to extend and embed an interactive and dynamic communications infrastructure that engages a growing and disparate freelance working community through disseminating a wide range of skills-related IAG and signposting
• Maximising multi-union collaboration to source and maximise additional resources to facilitate sustainability
• Continuing to develop mutually beneficial industry relationships to keep abreast of change and maximise intellectual capital and other resources.

Who’s in FEU Training

Equity, the Musicians’ Union, the National Union of Journalists and the Writers’ Guild of Great Britain will continue the successful partnership under the banner of the Federation of Entertainment Unions (FEU).

Coming soon

Look out this summer for the launch of FEU Training’s new course programme including further additions to the digital learning centre.

If you work from home and you ask HMRC how much you can charge for using your home as an office, you’ll get one answer: £2 a week. That’s a little over £100 a year. Without the advice of an accountant that is all you’d be able to offset against tax.

The reality is many of us can charge substantially more than that. HMRC has oversimplified it to try to stop people claiming what is rightfully theirs. “This is the best example of why you should use an accountant,” says tax expert Dave Morrison. “How much you can claim varies depending on the size of your house and how much of it you are using for work and whether you are using it exclusively for work. If you are using a quarter of your house for work then you can claim a quarter of the running costs.”

Dave is a former MOBO-nominated DJ and music promoter who has returned to accountancy. He specialises in entertainment clients and covers not just actors but all the trades involved with film, TV and theatre as well as musicians and other media types. He’s a partner at Nyman Lisbon Paul but is also on the entertainment and media group at accountancy body the Institute of Chartered Accountants in England and Wales (ICAEW). He knows his onions.

Dave is swift to point out that someone converting a room at home into a studio, for example, needs to be careful not to put the cost of the conversion against the business, otherwise the house will become liable for capital gains tax when sold.

Expenses

Depending on what job you do, there are loads of things you can claim as legitimate business expenses. Actors, for example, can claim theatre and cinema tickets; musicians can claim CDs or music downloads or the cost of concert tickets. But Dave warns you not to try it on – you cannot take your spouse to the theatre or concert and claim for two tickets.

The thing about tax and accountancy is that the rules are not fixed. Apart from changes announced in budgets each year and tweaks to legislation or to regulations, UK legislation is also shaped by individual court and tribunal rulings that can radically alter the way everyone has to do business.

There are major cases – one at present is looking at ITV services and how TV workers should be treated for National Insurance. There are also tax raids on suspected dodgy accountants, sometimes leading to convictions and sometimes to HMRC getting egg on its face. A high-profile raid in 2010, for example, targeted an accountant, Christopher Lunn – he had a lot of entertainment clients whose affairs were thrown into disarray. People such as Dave have to keep abreast of all these.

There are also specific rules for different sectors, with certain grades of contractors having to comply with fixed accounting rules.

Limited company

Then there are decisions about whether or not a freelance might benefit from trading through a limited company rather than as a sole trader. Some firms, such as the BBC, quite like paying freelances through limited companies, others less so.

Accountants have different opinions on the income level at which it becomes worthwhile for a freelance to pay the extra costs of running a limited company. Their advice is based on an individual’s circumstances; it’s not a tick-box exercise.

The key thing is to take your accounts and book-keeping seriously and to pay a qualified and regulated accountant for the best advice you can afford. It may seem taxing, but it’s better than being overtaxed.

Links (new windows)

• Dave Morrison at Nyman Lisbon Paul
• ICAEW report on the ITV Services case
• ICAEW report of the Christopher Lunn case

To err is human, but to really foul things up requires a computer – you’ll remember that adage if you are of a certain age. But the reality is that these days we all need to do our accounts on a computer. That means choosing what software to use.

The first thing is to check with your accountant what they are used to working with and what they recommend. You want to be able to hand your accounts over electronically, either on a disc or by email.

 Simple or complex?

You also need to bear in mind how complex your accounts are likely to be. Most lone freelances with basic income and expenditure accounts can probably manage with just inputting the numbers into a spreadsheet under the right headings. That probably simply means Microsoft Excel or something similar – that comes as part of the Microsoft Office suite.

You might prefer something that can handle more complex data – certainly worth it if you are planning to be busier and expand into new ventures or operate as a company. You might need to buy an accounts package, such as Quickbooks or even Sage.

Many accountants are happy to receive files in these formats. Sage is the sort of package big businesses use – and can manage payroll, for example – though small business versions are available. But Sage is far from intuitive – I find it almost impossible to understand – so only go down these routes if you are prepared to devote time to learning the intricacies of the software or ready to pay someone to do your book-keeping for you.

 Online solutions

The other option is to look at online book-keeping packages. Many accountants will now accept accounts in some of the formats available. The advantage of these is that they are free, or cheap, and you can update your accounts from any computer rather than having to be at the computer with your software loaded.

The downside is that they are often limited and you hear reports of them failing and data being lost. Having paid nothing or next to nothing, there’s no recourse if you need to complain. Check your accountant’s experience of the online services and follow their advice.

Previously, FEU Training has been running skills development opportunities to help freelances gain the necessary business skills necessary to support their work.

The new project phase will continue to focus on this area with aims of providing a range of affordable, accessible and relevant training opportunities along with up to date information and advice.

Who’s in FEU Training?

The project will be lead by Equity with three other partners including the National Union of Journalists, the Musicians’ Union and the Writers’ Guild of Great Britain.

 More information

Now under development, look out for updates on up and coming opportunities.

Choosing the right accountant for you and your business is crucial. You need to be able to trust your accountant to do the best for you, to give you accurate advice and to present your affairs in an honest and accurate manner to the taxman.

Get it wrong and you may face the wrath of HMRC and full-blown investigation into your affairs, in which you will be expected to produce all your records going back years and you may be expected to justify each and every item of spending.

My first recommendation is that you choose professionally qualified and regulated accountant. In effect that either means an ACCA-qualified accountant or, more likely, an ICAEW-qualified accountant. ACCA and ICAEW are accountancy institutes that not only set qualification standards but regulate their members. ACCA members are generally called certified accountants and ICAEW members are called chartered accountants.

“It’s fun to charter an accountant…..and sail the wide accountancy” – Monty Python

Be warned: anyone can call themselves an accountant. Many are not qualified or only partially qualified. Only regulated firms come with any official guarantee and back-up – they must carry professional indemnity insurance, for example, to cover any errors or omissions they make.

It has been known for an accountant with a large entertainment-based clientele to come unstuck with the Revenue and have certain expenses challenged. This results in HMRC investigating every single client and demanding back payments of tax for exaggerated expenses claimed.

Why a chartered accountant?

Michael Izza, chief executive of the ICAEW, said: “When hiring an expert for any job, a client wants to know they are buying expertise based on quality, honesty and efficiency. It is also vital that the ‘expert’ is suitably qualified, has undergone the correct training and is subject to some kind of regulation to ensure a high quality of service.  This is true of doctors, teachers and lawyers, and ought to be for accountants too.

“Chartered accountants have all these qualities, and we want people to know that even in their day-to-day life our members can be an invaluable help in saving you money. You can definitely count on a chartered accountant.”

Before becoming a chartered accountant and using the designatory letters ACA or FCA, ICAEW members must:

• undertake a period of at least three years’ training with an organisation that is authorised by the ICAEW
• pass exams covering financial management, auditing, business strategy, taxation and IT
• undertake a programme of Continuing Professional Development, which demonstrates their commitment to high standards.

The ICAEW said it also ensures that chartered accountants develop communication skills, business awareness and professional judgement.

Finding an accountant

To find a chartered accountant, the ICAEW provides a search function on its website (new window), which will list firms by name or location and by their specialist area.

But try to find one that others in your field use. They will know the rules governing your sector and have a good idea of what others like you have successfully claimed as legitimate expenses.

You may also want to think about whether or not you have ambitions to be more successful in the future. Some accountants handle thousands of similar clients sausage factory style – and that may be ideal as it keeps costs low.

But if you hope to be more successful and have a growing income, consider a slightly bigger accountancy practice with a broader range of skills and experience. It will be able to grow with you and provide new, different advice and accounting support as your circumstances change.

And spare a thought for the chartered accountant who really wants to be a lion tamer.

Every creative freelance should hire an accountant to do their accounts and file their tax returns.

Many freelances refuse to pay an accountant, preferring instead to struggle through their self-assessment form themselves. Well good luck to you, if that’s you.

That’s exactly what the government wants you to do because it knows you will not be deducting all the costs and making use of all the allowances that you could have used. You will be paying more tax than you should have done and Chancellor George Osborne will be delighted.

I’m good a maths. I understand numbers better than most journalists (many of us think of ourselves as wordsmiths first and foremost). I’ve worked on several financial and accountancy magazines and websites. I’ve interviewed chancellors of the Exchequer, accounting standards setters and bigwigs in Her Majesty’s Revenue and Customs. But I pay an accountant to go through my books and put everything in order.

Pay for professionals

Actors hate it when non-Equity extras get used, when the am-dram queens think they’re as good as drama-school trained professionals. Journalists get riled when teachers get the job of covering sports matches or students get to write gig reviews, just because they’ll do it for the free entry ticket rather than charge a proper fee. We’ve all seen the well-meaning amateur make a hopeless hash of a job we could have done to a professional standard.

Well, it’s the same with accountancy. Being good at maths doesn’t make me an accountant.

An accountant will be able to do your accounts faster and more accurately. They will know the tax allowances that benefit you. They will know what expenses you can legitimately offset against your income and those you cannot. And they will know where to find answers to questions much faster than you can.

 Knowing the market

If you use an accountant who knows your sector and has other clients in similar lines of business they will know the specific schemes that operate in your sector – film and TV have their own rules, for example – and what others in your field have successfully claimed or unsuccessfully tried to claim.

And there is an additional benefit of using a professional accountant: should the taxman investigate and discover your accountant has got things wrong, you can sue your accountant – those regulated by their professional bodies are required to have professional indemnity insurance to cover just such an error.

Next: How to choose your accountant.

Organise yourself. Ask for receipts and keep them. In fact, file them – don’t just stuff them in a carrier bag to deal with later.

Handing over a shoebox of receipts to an accountant at the end of the year is a guarantee of a more expensive accountant’s bill and you paying more tax than you should have done. Good record-keeping will save you money.

It’s the easiest thing in the world to leave admin until later but it’s the hardest thing in the world to catch up months later. Try to schedule an hour a week or an afternoon a month to catch up with all your accounts and admin.

Keep a diary and make sure you check your receipts against trips out. Most of us can expect to have receipts for trains or taxis or petrol, plus some subsistence – coffees or lunches – as a minimum on a day out, but there may be other items too. Did you buy an important newspaper or specialist magazine that day? Did you get some photocopying done or buy some stationery or something for your computer? By checking your expenses against your diary you will spot missing receipts in time to find and file them.

Check your monthly credit card bill and bank statement. Is there any spending there that you have not included or for which you can find the receipt? Have you got the bill that’s been covered by a direct debit payment – often bills are no longer posted and you need to go online and print them out. It’s much easier to do this each month than to try and print out 12 monthly bills at the end of the year. If you bought something online have you printed out the emailed invoice?

It is often easier to have one credit card for business spending – but always pay it off in full every month. You can then include your credit card bill with your accounts as evidence of spending, even if you have misplaced a receipt.

But don’t shy away from cash if cash is the cheaper option. I have seen people in coffee shops try to buy their cappuccino by card, only to be told there is a minimum charge that requires them to buy a pastry too. There’s no saving there. Paying by cash and keeping the receipt is a better option, providing you are efficient enough to keep that receipt and file it as soon as you get home or back to your office

The key is being organised. Put in place a system that suits you – and stick to it.

Today is the first day of the new tax year (it runs to 5 April 2013). As of today you can earn £7,440 over the next 12 months without paying any tax.

But that is £7,440 after expenses. That’s after you have deducted the cost of travel, of equipment, of any studio time or other professional services you might have needed during the year. It’s after you have deducted the cost of working from home (if you do). It is even after you have deducted the costs of being a member of the appropriate union.

So April is a good time to start thinking seriously about how you keep your accounts, how you organise your financial affairs and how you operate as a business. That is key: as freelances, we are small businesses. When it comes to money we need to think of ourselves not as creative people but as businesses that provide creative services or products.

By the end of April I hope to have given you plenty of ideas about how you can make more of the money you earn yours by keeping better records and using the full range of tax allowances and benefits available to you.

Analyse in detail how you succeeded when you were successful, and what went wrong when you failed – learn from your successes and your failures.

Before calling a potential new customer – a prospect – or an existing supplier, we should have in our mind a sequence of logically progressive steps that lead to a conclusion that can only be a sale – a close.

We should, therefore, decide:

• What do we already know about the buyer and his/her business?
• What else do we need to find out?
• How can we find this out?
• What benefits are most likely to appeal?
• What is the most effective way in which we can present these benefits?
• What problems, snags, objections are likely to arise?
• How can we deal with them?
• What sales aids, literature, examples of our work, do we need?
• What is the specific objective to be achieved on this call?

Our checklist for successful creative selling is:

• Focus – we must focus the attention of the customer on what we want to talk about.
• Involvement – we involve the customer by asking questions.
• Need – we must identify the buying motives of customers.
• Suitability – we must match the benefits of our products or service to the buying motives of the customer.
• Objections – objections must be handled.
• Action – remember to ASK FOR THE ORDER (we’re bad at this bit).

Good luck.

In sales jargon making the sale is called the close. And there are a number of ways you can close a sale. You have to judge which is suitable for each particular situation and each client (on the subject of jargon, someone who has not bought from you before is not yet called a customer or a client but a “prospect”).

Here are some types of close

• Alternative close  – You give the buyer two alternatives: “Shall I deliver on Wednesday or Thursday?”, “Would you like part of the order this week and part next or would it be more convenient to send it all at the same time?”, “Would you like one or two?”.
• Summary close – Briefly summarise the major benefits, get agreement and start to write out or type up the order.
• Comparison close – Compare a short list of disadvantages with a longer list of advantages and assume an order to be the logical outcome.
• Assume order close – Ask a question, such as: “What time is best for delivery?” “When do you want it by?” “When do you need me to start?”
• Last objection close – Get agreement that, if this one, final, objection can be overcome, an order will follow -  then overcome it.
• Fear close – Show that some severe loss or inconvenience will result if the order is not placed. This can be used to close on a stall objection, such as “I won’t be able to do it at all if you leave it until next week”.
• Concession close – Offer to make a special concession in the case of this particular buyer.