15 Mar Accounting tips for bloggers
Many bloggers are unaware of the accounting that is required for their business, which leads to the inevitable panic at tax return time!
To help avoid this, we are outlining the fundamental concepts that bloggers should be aware of:
If you are new to blogging or are already in employment, you need to review whether you will need to register for self-assessment with HMRC. In most cases, if you are receiving payments or income for any kind of activity (such as AdSense) then you are a business and will need to register.
The following items all count as income and are easy to track – selling advertising space or AdSense, affiliate sales and cash payments. If you have received a product or service in exchange for a review, this is more of a grey area. It’s best to seek professional advice if you are unsure.
The rule here is that you can deduct expenses from your income if they are incurred wholly and exclusively for your business, i.e. you only incurred the expense because of your blogging. Good examples include phone bills, internet and website costs and marketing expenses. You can not include any entertainment costs or subsistence (food and drink) unless it was for an overnight stay for your blog/vlog.
You may also be able to claim for the costs of working from home.
You should be keeping records of all income and expenses, however small and ideally with receipts. If you are unclear on whether a transaction meets the income or expenses thresholds, keep a record anyway.
It will make your life a lot easier to have a separate bank account for your business transactions.
Seek professional help
Accountancy for bloggers may seem straightforward on a day to day basis, especially if you are being paid in cash. However, when you do get to self-assessment time, there can be some tricky concepts where it would be beneficial to seek an accountant’s help. Things such as claiming for capital allowances, VAT and working from home expenses can be maximised with the help of a professional!