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Thanks useful information: 7
How can you factor your personal costs into how much you charge? Shouldnt your personal expenditure be determined by how much you earn, not vice versa? If I decide to have two Ferraris parked in the garage does that somehow make my work worth more than the guy who drives some bomb? Ridiculous, unethical way to develop a pricing structure.
I think some ppl are taking this calculator a little bit tooooo seriously. My god its just a rough rough calculator to give you a ROUGH idea.
Please dont let it run your life from now, its not a Scientologist calculator!
Its totally valid if you are considering being a FT Pro.Originally Posted by ricktas
How valid is it you you are a hobbyist is all I am saying
And yes JM, it's only home economic 101
Darren
Gear : Nikon Goodness
Website : http://www.peakactionimages.com
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Constructive Critique of my images always appreciated
yes, where what you are selling is you and your image
NOT happy Jan !
Have you actually spoken to an accountant on this issue Kiwi ? Because I think you'll find that any income is declarable, and they dont give a rats if you think its a hobby, if you're charging then they want their cut.
And to be utterly honest its this type of attitude that is killing off the profession of photography, and a dam silly one at that ! Sure you may be lucky or talented enough to have a full time job that allows you to earn enough to then also shoot and gain work normally taken by professionals that you then can then choose to shoot and seriously undercut those depending on that as a living. And let me second guess you here, but before you say that you are just a hobbyist, you actively market towards covering sporting events to an "international level" ? Not really just a hobby ! So perhaps even if you think you're right here, perhaps you should take a little more consideration of those photographers who do have to consider all costs before working out there charges as opposed to simply saying that you dont care about these things?
Yes I have actually William. A tax accountant. Im one too although not a tax specialist.
Re what I charge, as far as I know ive charged market rates, or got paid market rates for someone with my experience.
Re the hobby angle, well, it's a point of interest I am raising, I know its a big issue for the industry.
As a part timer, that tries to earn income, it would be very easy to not charge or not charge a "going rate" whatever that might be becuase as you say it's not my 9-5 job that I do get paid for and my pay supports my camera hobby, not the photography related income
Im not sure whether charging market rates is appropriate as then you are a part-timer competing with a full-timer and should be outgunned on professionalism and quality. Is it ? Im really interested in your view on the industry and where it's going in this regard.
Id like to do the "right thing" whatever that is. I didnt say I didnt care, I do.
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Last edited by kiwi; 14-05-2010 at 7:54pm.
I agree that Kiwi is wrong about being able to earn $20,000 without paying tax, but I don't agree that "this type of attitude that is killing off the profession of photography". Do you really expect everyone to stop and ask if someone is making money from what they do for free? And then to refrain from doing it just because someone is making money from it? Even the professions like law and medicine have had to change to suit modern demands, so why think that photography, which unlike law or medicine has no legal protection, should be any different? You can't turn the clock back to the 1950's, and why would you want to?
It wouldn't be me that would be wrong, it would be two independent tax accountants. I wanted to be a business so I could claim expenses etc
There are a number of tests applied to whether you are a hobby or a business, the 20000 figure I was told was one main measure the ato used to determine this - not published but Is in rulings
Anyway, this is second hand information so seek your own advice
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The thing is everything has a cost and regardless of whether you are a pro or a hobbyist or whatever, every time you pick up your camera and walk out the door you are incuring a cost to yourself.
So if you get a chance to recover those costs then why not do it in a professional maner and take into considerations all the costs that it cost you to take that picture. Costs include, time, fuel, where and tear of your motr vehicle, entrance fees, food etc.
At the end of the day a hobbyist will sell the phot at whatever price he/she wants but then they have made a concious decision to make a loss.
I have had three articles and photos published in a national magazine and I was paid $50 per article. I estimates that it took me over ten hours of work to produce each article so I was paid at $5 per hour. But I did it because of the type of magazine (it's a free industry based one) and it gives me exposure and experience for when I get to the next level and get published in a glossy mag.
Once I get to that level - even as a hobbyist - I wont be working for $5 an hour and I will ensure that my costs are covered.
Karl
Everyone is entitled to my opinion
Canon G12 in a Recsea housing with twin YS110 Alpha strobes
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Karl,
Dont you think though that once you have a reputation as a $5 per hour photographer, or for free, that it's likely to stick with you, at least with that publication ?
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I really didn't read it as Darren saying that you didn't have to pay tax until you earned $20 000.00.
I read to mean that you weren't classed as a business, you were classed as a hobbyist by the tax office, and as such couldn't take advantage of the deductions available to a business that would then reduce the amount of tax that you paid.
That's the way I read it any way
No, my advice was that there was no requirement to declare the income. If you were to declare the income then of course you could offset expenses.
Once again, my personal circumstances and advice is only mine. Talk to a tax accountant or ato regarding your own circumstances
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There are rulings around concerning thoroughbred breeding in the context of hobby vs business (and this is an industry where a yearling can sell for $1m) - I can't remember the details, but it revolves around proving you are a business. This can include a business plan, a significant proportion of of personal income being derived from the business, employing others, a business name, premises. Although I have no problem proving that we are a cattle business, our horse breeding is still treated as a hobby - in spite of receiving over $60k for horses sold (you don't want to know about the costs though) I'd expect proving you have a photography business has parallel requirements.
As kiwi says, talk to an accountant - but kiwi's $20k seems a viable benchmark. Remember, this is billings - it is NOT earnings, as costs have not been taken into account. (Now, this gives me an idea ... a photographytax dodgemanaged investment scheme for high earners. Who wants a D3x for their holiday snaps... 49% off...
The hobbyist issue here is not about "devaluing the industry" or "stealing from professionals" (or even "tax evasion") - it is straight (or arguably convoluted) accountancy and tax law that applies across a range of industries. Don't confuse the ATO's view of "hobbyist", be it photographer, horse breeder or whatever who still sells things deliberately, and the more generic hobbyist or amateur who does it for fun, and a sale is a bonus.
The issue that the photography industry has to face up to the fact that it has low barriers to entry and a lot of willing participants. If some of those competitors are "hobbyists" (in an amateur sense), the "professionals" will have to recognise that there is more than providing an image, and instead start to provide what "hobbyists" can't - professionalism, reliability, consistency, attention to detail, marketing - and work at retaining their clientele.
Regards, Rob
D600, AF-S 35mm f1.8G DX, AF-S 50mm f1.8G, AF-S 24-85mm f3.5-4.5G ED VR, AF-S 70-300mm F4.5-5.6G VR, Sigma 10-20mm F4-5.6 EX DC HSM
Photos: geeoverbar.smugmug.com Software: CS6, Lightroom 4
I am pretty sure you can make upto 18K a year on a hobby before having to declare it - we breed cattle as a 'hobby' ... once again check with your relevant tax specialist
Dont misunderstand me, I'm not asking for anything. Simply put, in my world, if you're a hobbyist, you're not charging. If you charge you're in business. It makes no difference if you're making a profit or making a loss. Any income is meant to be declared, and after 38 years of declaring my income, and having a variety of jobs, careers and multi careers, I dont need a couple of ten accountants to point out what is obvious to most.
What I meant about the costs Steve, was that you're right there is a difference between someone doing something for free and someone doing it for a charge, but if you intend to emulate those who're doing it for a charge, then its wise to understand the true costs of being in business. Isnt that what this topic was about.
And there is no need to discuss or debate turning the clock back, as there have been decades of hobbyist photographers doing something for free or at a much lower cost than the professional who is having to charge a rate to make a living from the profession of photography. Its something I tackled from the other side of the fence about 30 years ago. It seems to me that its fairly easy to get yourself published. Even easier to chuck up a website without too much of an outlay, have a mobile number no other contact details and claim that you're in business without even going to the trouble of the costs and outlay of a normal business. But its another matter to make a business out of it where you can not only cover the costs of your gear, but tax, insurance, public liability, and support your family (and I dont expect anyone to cover those costs, but pointing out that it can be done), so its worthwhile reading the information originally offered. That was my point.
And if you go back to the original topic headline and content, this subject was all about the working out the true costs of being in business. So those who market, and this is my particular bone of contention, where they have a clearly seperate business, and who are charging, however uneconomically, then they, according to the ATO's website, have to declare all income.
BTW just read Rob's excellent response. I agree with you entirely and your last sentence is exactly what does differentiate the pro from the hobbyist. But be aware that few photographers with websites, state their position and its up to the client to find out how to differentiate between the two.
Last edited by Longshots; 15-05-2010 at 10:09am.
No not really in this case. This magazine is owned by a much larger publishing company and they use it to give a 'spring board' into their industry. By submitting articles / photos into their free mag they work with you to develop your style and because it is an industry free magazine it is accepted that some of the articles may not be up to the higher standard.
Once you reach certain levels they move the bar. In my case they have asked me to continue to submitt articles as well as submitting a portfolio of my photos. If I decide to continue to improve my style of writing the next step is that they ask you to become a contributor to their glossy mags.
Everyone has to start somewhere and for me this is a good way to get into the industry - especially these days as there are so many people with cameras taking photos, but there aren't as many that can take a photo and put words with them and produce an article that people enjoy reading especially one without all the cliches etc. Also it gets me known out there in scuba diving circles as well and I can put it on my resume etc.
Very few people get articles published in big mags the first time around - same as photos and it take work, but you should never under sell yourself.
BTW - the photos I put with my articles for this mag are basic but reasonable quality once I get into the glossy mag then I will be submitting higher quality photos
Karl
I think the tax man might view it that you are wrong, Kiwi. I suggest you don't try it..
I think you are confusing the $20,000 profit you need to make to share your expenses with your primary income. That's very different from being able to make $20,000 income without paying tax.
Many hobby farmers used to do this up here. Buy a macadamia farm, use all the expenses as a loss against your tax (from being a doctor or whatever), make a small profit and a large capital gain on the farm. Great while it lasted. Then the tax man said, no no no. You have to make $20,000 profit on your hobby farm (or whatever) before you can claim the farm expenses against your primary income. Almost no hobby farmer does that, so bye bye loophole. Exactly the same applies to photographers, but you still have to declare the income you make and I assume you can claim your photography expenses against your photography income.
Of course, like you, I'm not a tax agent so you must do your own checking.
I agree 100% with this. I am in the hobby/business/sport of breeding pedigree dogs. Same situation as the horses really and I have looked into the tax requirements and the tax office 'rulings' and other guidance said that it is basically optional for us. I know plenty of people that run their breeding as a business, but I can't imagine why you would want to go through all the rubbish that goes with running a business unless you really had to. I seem to recall there were rulings around profit...ie a guidance was that you should reasonably expect to make a profit for 3 out of every 5 years or something to that effect. At the end of the day you need to be making a lot of profit (not just takings) to interest the tax man.There are rulings around concerning thoroughbred breeding in the context of hobby vs business (and this is an industry where a yearling can sell for $1m) - I can't remember the details, but it revolves around proving you are a business. This can include a business plan, a significant proportion of of personal income being derived from the business, employing others, a business name, premises. Although I have no problem proving that we are a cattle business, our horse breeding is still treated as a hobby - in spite of receiving over $60k for horses sold (you don't want to know about the costs though
As kiwi says, talk to an accountant - but kiwi's $20k seems a viable benchmark. Remember, this is billings - it is NOT earnings, as costs have not been taken into account. (Now, this gives me an idea ... a photographytax dodgemanaged investment scheme for high earners. Who wants a D3x for their holiday snaps... 49% off...
The hobbyist issue here is not about "devaluing the industry" or "stealing from professionals" (or even "tax evasion") - it is straight (or arguably convoluted) accountancy and tax law that applies across a range of industries. Don't confuse the ATO's view of "hobbyist", be it photographer, horse breeder or whatever who still sells things deliberately, and the more generic hobbyist or amateur who does it for fun, and a sale is a bonus.
The issue that the photography industry has to face up to the fact that it has low barriers to entry and a lot of willing participants. If some of those competitors are "hobbyists" (in an amateur sense), the "professionals" will have to recognise that there is more than providing an image, and instead start to provide what "hobbyists" can't - professionalism, reliability, consistency, attention to detail, marketing - and work at retaining their clientele.
Couldn't disagree more with that statement. Just because you receive reward whether it be money or otherwise does not mean you are in business. Gee we're about to sell our baby gear, doesn't mean I'm in business!
On the issue of hobbyists taking business from pro's. That is the world we live in. I am very much a hobbyist but I will charge for my work. Photography is no different to any other service. People will pay according to their requirements or expectations. I might pay the kid down the road a few bucks to mow my grass, you might pay Jims mowing more for a professional job. The issue of a hobbyist marketing themselves to shoot weddings for example comes down to the customer. As with anything it is buyer beware!
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