Accountants for Actors

One of the best things about being an actor is no two days are the same. One minute you’re shooting a TV drama, the next you’re doing voiceover work, teaching drama workshops – and sometimes doing some temp work to fill the gaps in between. It’s a super exciting career, but from a tax perspective it can get very complicated.

That’s where having the right accountant makes all the difference. In this guide, we’ll walk you through everything you need to know about managing your finances as an actor. From choosing a legal business structure, to ensuring you aren’t giving HMRC all your money.

Do actors need an accountant?

Not legally no – but it’s well worth considering. Actors often have several streams of income – often across a single year, some PAYE employment (either from a side job or working directly with a production company), as well as self-employed work and residual payments. Keeping on top of all of that and your tax return each year is a lot to take on when you’re focused on your craft.

A good accountant will make sure you’re claiming everything you’re entitled to, keep you on the right side of HMRC, and give you one less thing to think about.

What business structure should actors use?

Choosing the right legal business structure depends on your situation. For most actors this will either mean registering to pay tax as a sole trader, or setting up a limited company.

Sole trader

This is the simplest option, and it’s where most actors start out. As a sole trader you’ll register as self-employed with HMRC and pay Income Tax and National Insurance on your profits by sending a Self Assessment tax return.

There’s very little admin involved in setting up, and it’s fairly easy to keep up with the record-keeping and reporting requirements if your income is straightforward(ish).

The downside is that you’re personally liable for any debts because there isn’t any legal separation between “you” as a person and “you” as a sole trader. You’ll also pay tax on every single penny of profit you earn, and this can can make tax planning a bit more complicated (we’ll explain why in the next section about limited companies).

Limited company

A limited company is a separate legal entity, which means your personal finances are kept separate from the business. Your company will need to pay Corporation Tax on the profits it makes each year, but you’ll only pay tax as an individual if you take money out of the business for yourself – and it’s up to you how you do it, such as by:

• Paying yourself a salary (which is subject to PAYE). You might need to pay tax and National Insurance on this – it depends how much you take out.
• Taking dividends from any profits, which are generally taxed at a lower rate than income and aren’t subject to National Insurance

It can be a more tax-efficient business structure if your earnings tend to fluctuate quite a bit from one year to the next.

It’s worth noting though – it comes with more admin. For example, you’ll need to file annual accounts with Companies House, submit a Company Tax Return, and keep more detailed records.

This isn’t the business structure for everyone, especially if you’re just starting out or you only get self-employed acting work from time to time. For the right advice – chat with an accountant.

What taxes do actors pay?

This depends on things like your business structure and the type of income you’ve received, such as from an employer or as a self-employed person.

Income Tax

If you’re employed directly by a production company, broadcaster, or theatre, you’ll likely be paid via PAYE. That means tax and National Insurance are deducted from your wages before you receive them – the same as any other employee. You may also receive a P60 at the end of the tax year.

This goes for any work you do in between, for example if you’re a bartender or work in an office in between gigs.

Income Tax… again, but this time because you’re self-employed

Most actors will also have self-employed income on top of their PAYE work. If you do this as a sole trader then it will need to be reported to HMRC through a Self Assessment tax return or using MTD Income Tax depending on how much you earn.

National Insurance

Fun fact – there are different types of National Insurance, and the type (or class) that you need to pay depends on how you earn.

• As a self-employed actor, you’ll pay Class 4 National Insurance on your profits. The current rate is 6% on profits between £12,570 - £50,270, and 2% on profits above that.
• Employees pay Class 1 National Insurance, and this is deducted by your employer before they pay you. If you’re self-employed and employed then you might pay both types (but not on the same money).

Corporation Tax

If you operate through a limited company, the company pays Corporation Tax on its profits. The main rate is currently 25% for profits above £250,000, with a lower rate of 19% for profits up to £50,000.

What expenses can actors claim?

For self-employed actors any expense you incur that’s wholly and exclusively for business use is an allowable business expense. Some popular expenses you’ll likely be able to claim include:

Headshots and promotional materials

Professional headshots are an essential part of getting work as an actor, so the cost of having them taken and printed is an allowable expense. The same goes for showreels, voiceover demos, and any other promotional materials you need.

Agent fees

If you work with an acting agent, their commission is deductible as a business expense. Typical agency commission is between 10% and 15% of your earnings.

Travel

Travel costs for auditions, castings, rehearsals, and performances can all be claimed – as long as you’re not just commuting to a regular fixed place of work. Keep a log of your business journeys, including dates, destinations, and the purpose of each trip.

Costumes and clothing

This one has some nuance to it. You can claim for costumes that are specific to a role and that you wouldn’t wear in everyday life. But general clothing – even if bought specifically to wear on set – typically can’t be claimed, because HMRC considers it to have a dual purpose. So, if you wear something to an audition but you’d also wear it to the pub – it’s a no go.

Training and professional development

Acting classes, workshops, coaching, and courses directly related to your profession are generally allowable expenses. The key test is whether they maintain or update existing skills, not whether they help you get into a new career.

Subscriptions and memberships

Professional memberships such as Equity (the actors’ union) are deductible, as are subscriptions to casting platforms like Spotlight, Mandy.com, or Casting Call Pro. Even Netflix can be tax deductible if (and only if) you use it for research purposes, not a binge watch.

Home office costs

If you work from home – preparing for roles, doing admin, recording self-tapes – you may be able to claim a proportion of your household costs, such as broadband, heating, and lighting. HMRC allows a simplified flat rate of £10-£26 per month depending on how many hours you work from home, or you can calculate the actual costs if that works out better.

Equipment

Some equipment which you expect to keep for a long time, such as cameras, ring lights, microphones, and other equipment used for self-tapes or voiceover recordings might actually be suitable for capital allowances. The rules can be quite confusing for this, so it’s worth consulting on it.

Make-up and skincare

Now this is a grey area. HMRC is generally quite strict here – make-up used specifically for a role (stage make-up, for example) may be claimable, but everyday make-up or skincare typically isn’t, even if you wear it only for work. Basically, if HMRC think you may wear it out and about outside of the job – it’s probably best to leave it off.

Keeping good records

Whatever your business structure, you’ll need to keep clear records of your income and expenses. That means holding onto invoices, receipts, contracts, and any other relevant documents – HMRC can ask to see evidence going back up to six years.

Good bookkeeping software makes this much easier. It lets you log expenses as you go, connect your bank account, and keep everything in one place, so your accountant has everything they need at tax time.

Are you an actor in need of an accountant? Cast us! We’ll handle the numbers while you handle the spotlight. Get an instant online quote today or call us on 020 3355 4047 to chat to the team.