In the wake of COVID-19 setbacks, arts professionals need to maximise on their tax returns this year. Creative Crunchers specialises in making the numbers work for artists.
Matthew Tucker of Creative Crunchers. Image Hannah Photography.
‘Being on the front foot – financially – is more important than ever for artists, creatives and arts organisations,’ said accountant Matthew Tucker.
As the arts and entertainment sector faces the end of the financial year and a past quarter decimated by the Coronavirus pandemic, Tucker said that specialist advice can help professionals navigate their way through in the face of ‘all of these stimulus measures and policy-on-the-run like never before.’
He continued: ‘Many arts practitioners are confused heading into this tax year and they are not alone.’
A principal at the Brisbane-based firm Creative Crunchers, Tucker told ArtsHub he is expecting a rush on tax lodgements this year, in order to pull a return from work done before the pandemic and before employment ground to a halt for many.
‘A quarter of their year disappeared. People will want to lodge earlier to unlock refunds sooner. They will also be looking to defer paying tax as long as possible,’ he said.
This is where a specialist tax accountant can help arts professionals, at a time when they perhaps most need it in their careers.
Tucker said that the value of going to a specialist accountant is that they operate with a better knowledge of specific provisions. ‘That is a huge advantage,’ he continued. ‘A specialist accountant can help demystify where they stand and the sooner they know that, the sooner they can start maximising the cash flow that they have.’
Tucker continued: ‘We understand the areas particular to our arts clients such as income averaging, as a key plank, and all the tax tip strategies for deferring income to the next financial year or bringing forward expenses and writing off assets upfront under the small business measures. We are aware of the ever-changing landscape – and the increasing scrutiny of the ATO in compliance.’
Knowing the intricacies and nuances of a creative world is knowledge worth investing in and, if anything, it becomes a kind of partnership to help creatives navigate their finances and tax.
BOOKKEEPING FOR MENTAL HEALTH … OH, AND A TAX RETURN
Tucker said that one of the greatest financial stresses for arts professionals and creatives was not knowing where they stand.
‘In this industry it is not easy to budget and looking after your bookkeeping is a skill that needs to be acquired. We know numbers are not your forte but the best results come from adviser and client both playing a role in trying to advance that.’
‘Creatives need to know where their business is at, how small or large their tax position is, what their lodgement dates are, or how far they can defer them, and whether they can enter into payment arrangements with the ATO, which they almost universally can,’ said Tucker.
‘Gaining financial clarity is as much about good bookkeeping and budgeting as it is about knowing tips on what to do and traps to avoid,’ Tucker told ArtsHub.
Tucker and his team are able to guide their clients through blind spots. For example, suggesting that, ‘you should go and buy this asset, but defer doing that until this point in the future.’
He continued: ‘When you deal with creatives all the time and know what resonates with them, you can often pick the point at which their eyes glaze over. When that happens, we simply try to find another explanation to cut through. Our clients are basically creative storytellers so our goal is to make them understand these numbers are also part of their story.’
He also added that the tax landscape today is a minefield and compliance is becoming ever more complicated.
‘We hear from business coaches and software companies all the time that ‘compliance is dead’ but nothing could be further from the truth. The use of technology is increasing, but the error rate in its application and use is exploding.’
Learn how Creative Crunchers can help you with your financial management.