Whether working independently or as part of a glam squad, you make sure your clients put their best faces forward. But are you just as confident claiming your expenses and credits come tax time as you are applying perfectly winged liner?
Generally, a freelance makeup artist is considered self-employed. You set your own hours, choose who you want to work with, and schedule as many jobs as you want—the beauty (pun intended) of being your own boss. There is flexibility in freelancing, but there are also unique considerations when it comes to filing your taxes.
Read on for tax season tips you need to know as a freelance makeup artist, courtesy of the Canada Revenue Agency:
- As a rule, you can deduct any reasonable business expense you paid to earn income. Most tools and supplies in your kit (including brushes, disposables applicators and your arsenal of products), union dues, agent fees and even marketing costs are expenses. Transportation and other travel costs related to a job might also be deductible. Even fees to attend that coveted masterclass or beauty trade show could qualify. If you hire a professional to do your taxes, you can claim the service fee as an expense.
- Have an in-home beauty room where clients come to get dolled up? When you use part of your home for business, you may be able to deduct a proportionate amount of your household expenses. These include maintenance costs such as heat, home insurance, electricity and cleaning materials. As a homeowner, you may be able to deduct part of your property taxes and mortgage interest. If you rent your home, you may be able to deduct the portion of rental fees that relates to your studio space. For more information, go to www.cra.gc.ca/smallbusiness, and select “Business expenses.”
- Not sure if you should have a GST/HST account? Go to www.cra.gc.ca/gsthst and answer a short questionnaire to see if you need to register for one. If your business is in Quebec, go to www.revenuquebec.ca.
- No different than the compartments in your kit, it’s imperative to keep your paperwork organized. You need to complete records of business-related expenses to support your claim. Without supporting documents, the Canada Revenue Agency could disallow the credit or deduction. You generally need to keep your supporting documents for six years from the end of the last tax year they relate to, in case the CRA reviews your return.
- Unlike a pesky pimple, there’s no need to cover up and camouflage your tax blemishes. If you’ve ever made an error or omission, you can correct your mistake through the Voluntary Disclosures Program. If you do this before you become aware that the CRA is taking action against you, you might only have to pay the taxes owing plus interest.
Self-employed individuals and their spouses or common-law partners have until June 15, 2016, to file their income tax and benefit returns, but any balance owing is still due no later than May 2, 2016. For a list of software and services you can use to file online, go to www.cra.gc.ca/netfilesoftware.