Recording Studio Tax??

noodles33

Hey there,
Looking for help about the recording studio business. I'm setting up a small studio / rehearsal space and trying to find out about taxation and anything else that I need to know.

First off is there tax on recording sessions and at what rate?
Also is there tax on rehearsal sessions and again at what rate?
What about mixing seesions etc.?
I've read in some place that there is tax relief on music related sevices so just hoping this to be true.

Is there any grants outs there that are easy to get?
Whats the best way to keep the books and can you pay fees on the net?

Any help on these questions and any other info that would be good to know would be greatly appreciated.

Thanks, Conor.

PaulBrewer

Vat on services is 13.5% I believe.
Vat on 'stuff' , CDs, hardrives, perhaps strings and sticks in your case is 21.5%.

To charge Vat you need to be Vat registered and make a payment of Vat collected every 3 months as I recall.

This also allows you to claim Vat back on your Business expenditure.

Talk to an Accountant and look at http://www.ros.ie/PublisherServlet/home.

tweeky

Unfortunately Recording Studios/Producers/Mixers etc. are in the luxury bracket of 21.5% VAT at the moment.

PaulBrewer

tweeky wrote: »

Unfortunately Recording Studios/Producers/Mixers etc. are in the luxury bracket of 21.5% at the moment.

Aren't they a Service ? Has that always been the case?

leeroybrown

PaulBrewer wrote: »

Aren't they a Service ? Has that always been the case?

The 13.5% for services thing is a bit of a myth. There are many individual VAT designations (paid at 0%, 13.5% or 21.5%) including 'Recording, Studio'.

tweeky

Nope.

http://www.revenue.ie/en/tax/vat/rates/decision-detail-00240.html

cnuts

PaulBrewer

ooops ... I know some guys who may be in Soapybubble then !

old gregg

if you change the oil on a strat it's 13.5

madtheory

Note that you may not be earning enough money to have to charge VAT, in the beginning at least.

As Paul said, engage the services of a good accountant. By good, someone you get on with, and who knows abut music stuff (this is not as unusual as you might assume).

For grants, talk to your local enterprise board. But probably you'll have to design your business plan so that it's not a straightforward recording studio. You need a unique selling point so that you're not in competition, otherwose, they won't give you a grant so as not to interfere with other fledgling/ established businesses.

Plus, you basically deluded if you think you're going to make money with a traditional studio.

noodles33

So recording session = 21.5%. Rehearsal Space ? 13.5%? Mastering and Audio Editing at 21.5% again?

Also to be VAT registered turnover should be over €37.50k correct? So if I aint hitting €37.50k can the studio just be run without declaring anything and just keep accounts in and out? And does this mean if you do go over the threshhold do you only pay tax on everything over that?

Thanks,
Conor.

Welease

noodles33 wrote: »

So recording session = 21.5%. Rehearsal Space ? 13.5%? Mastering and Audio Editing at 21.5% again?

Also to be VAT registered turnover should be over €37.50k correct? So if I aint hitting €37.50k can the studio just be run without declaring anything and just keep accounts in and out? And does this mean if you do go over the threshhold do you only pay tax on everything over that?

Thanks,
Conor.

Wouldnt you still have to declare your accounts anyway?
Tax/PRSI etc would still need to be paid on wages, profit etc. (where relevant)

dav nagle

noodles33 wrote: »

So recording session = 21.5%. Rehearsal Space ? 13.5%? Mastering and Audio Editing at 21.5% again?

Also to be VAT registered turnover should be over €37.50k correct? So if I aint hitting €37.50k can the studio just be run without declaring anything and just keep accounts in and out? And does this mean if you do go over the threshhold do you only pay tax on everything over that?

Thanks,
Conor.

Until you are earning more than 37k a year you just pay a small amount of tax each year, around 750. If you are starting off you will be in this situation. You can have your tax direct debited 70 a month from your bank acount every month. Ring the tax office or talk to them, they are really helpful and friendly. You declare the tax based on what you are currently earning not what you speculate to earn.

dav nagle

noodles33 wrote: »

Hey there,

Is there any grants outs there that are easy to get?

There is no easy way to get free money but you could start by contacting your local enterprise board.

noodles33 wrote: »

Whats the best way to keep the books and can you pay fees on the net?

Get a hard assed accountant, that is key in your first year. You may be a deadly entrepreneur but without a realistic cash flow in and out you will have serious stress and financial difficulties.

noodles33 wrote: »

Any help on these questions and any other info that would be good to know would be greatly appreciated.
Thanks, Conor.

Your never working hard enough until your completely 100% consumed by your business. Watch out for snakes, they bite. Be patient, it takes time to get the word out there. Best of luck.

bedbugs

21.5% for composition too, for some strange reason. I guess you're giving them a product, but it could also be deemed a service.

madtheory

bedbugs wrote: »

21.5% for composition too, for some strange reason. I guess you're giving them a product, but it could also be deemed a service.

Nope, definitely a product. Intellectual property y'see (basis of copyright).

PaulBrewer

Everyday is, indeed, a school day ...

dav nagle

PaulBrewer wrote: »

Everyday is, indeed, a school day ...

Please dont remind me of school ahhgggggghhhh

PaulBrewer

dav nagle wrote: »

Please dont remind me of school ahhgggggghhhh

If you'd paid more attention you young pup ...

PMI

register for VAT anyway if you dont reach the bracket then you dont pay anything....

studiorat

PMI wrote: »

register for VAT anyway if you dont reach the bracket then you dont pay anything....

No, if you register for VAT you have to charge VAT on the work you do regardless of whether you reach the bracket or not.

If your sales are over €37,000 or whatever then it's manadtory that you rgister for and charge VAT.

madtheory

Yep, if you can avoid registering for VAT, do so, it's a PITA do keep track of it yourself. When your turnover is higher, you can pay your accountant to do it.

studiorat

serious pain in the hoop. We registered because in the begining we were paying out more VAT than we were taking in. Paying VAT on rent, equipment repayments and all the rest.

Unless you are forking out serious money registering isn't really worth it.