The unfairness of the tax system that punishes my creativity

I don’t write for a living. I write part-time. However, that doesn’t mean I am not a writer. It means I have not yet reached the dizzying heights of bestseller lists, the author tours, the book signings etc that will then allow me to live on the income I get from writing. It is a long journey; many have given up on the way, many have reached the dizzying heights.

One of the important milestones you mark as you embark on this journey, are the small successes. An inclusion in an anthology, a magazine story, a book published that did alright, but didn’t sell a million copies. And rightly or wrongly, when you reach these small milestones, you get rewarded with small amounts of money – believe me – they are small. If the emotional satisfaction of the money I earned from writing wasn’t so great, I wouldn’t even count it as spending money.

But as a British tax-payer, that milestone that comes with a small token of financial reward – is a curse. I was told that it was my self-owned business and although I can claim expenses, I still have to pay taxes on the small income.

Well, you might wonder, what’s so bad about that? Perhaps the small amounts won’t add up enough to be taxed. You would be wrong. The tax is not applied on just my writing income after deducting expenses, it is added to main income from my day-job and I am taxed a higher-rate based on the total income.

The other thing that irked me was that an advance was fully taxed on the higher rate in the year you earned it. But I said, this money  needs to tide over many years. You should make this proportionate over at least 3 years while I earn this out. Sorry, came the answer. You  made money now, you are taxed now. But a bigger amount in one year on a bigger tax rate is a lot of money gone. How can I live on this for the next 3 years? Sorry, not our problem, said the taxman.

The last time I spoke to my tax-accountant I was absolutely frustrated. But the income I get from my writing, is for my writing endeavours. I put in the hours after the day-job. I got up at  five in the mornings, to write for so many years to get one article published. I slaved over the weekends, giving up parks, sunshine, museums. I gave up going out at night, lest I should miss out on writing. How can that be taxed at a higher rate?

If I didn’t publish anything, and still spent money on books, courses and writing expenses – say postage, then I’d be better off. I will be penalised for being a good writer and actually getting published.

Or I should resign my day-job, be at the mercy of freelance writing, starve and give up writing, trying to save money in taxes.

How is this even fair? I am quite happy to pay taxes on my writing income – as long as the writing income is treated as a separate entity. On the off-chance that one day I will sell a million copies, like me, the taxman can hope forever waiting for my big fat cheque. But until then, why tax me on a higher rate?

How is the taxman going to give me back the lost weekends, slaving at the computer? My paid holidays evaporating in workshops? My evenings editing my manuscripts and not out with friends, drinking and spending the money on more VAT-charged stuff?

Creative people should not be taxed until they reach a bestseller list with tangible number of sales, after returns. The blood and sweat of a budding writer, a hopeful writer, a languishing artist is squeezed into a cup and handed over to a taxman who collects from the rich, the poor and the creative without any discrimination, unless you have a creative accountant and an offshore abode.

I am not sure I want to get a book published every time I sit down to do my taxes. But the writer in me cries out aloud for release – but at what price?

5 thoughts on “The unfairness of the tax system that punishes my creativity

  1. I thought you were allowed to spread such income over three years. Or is this because you are PAYE on employed work? I am in the same position. Also, I had a huge amount of back pay form my employer as they had underpaid me for a long while. Grr! In the month they paid up I paid proportionality 3 X as much tax as usual. The whole refund went on higher tax.
    I do use an accountant. That costs BUT is allowable against tax. They always get tax back than more than pays their fees. I don’t think I would have done it on my own. I do get tax back for books bought. I buy a lot as a writer and as a university lecturer.

  2. Hi Chitra

    While I understand the sentiment (I have done part-time work along side a full time job in the past), the tax allowance and tax banding is attributed to a person, rather than a job. Otherwise we could all have 5 different employers, one for each day of the week, ABC Monday Corp, ABC Tuesday Corp etc and with a separate tax allowance for each.

    Another option would be to get your employer to switch you onto an emergency tax code – that way you could get all of the allowances back after completing a tax return and could think it as a tax subsidy to support your writing 🙂

    Have you discussed having advances paid across multiple years? That might be possible, and could balance out the tax implications of getting the income in a single payment.

    If your writing counts as self employed work, you may also be able to offset expenses (computers, stationary, training courses/seminars, internet connection potentially) against income from the business, prior to tax being paid.

    Absolutely agree with your point about politicians expenses.

    Anyway – enjoy your weekend – see you next week

  3. Thanks Nick and Candy for taking the time to leave a note. I think my biggest frustration is that a part-time writer takes so much effort and spend their leisure in pursuing their dreams, and all the government can do is cash in on the hard-work. But the politicians can themselves claim for two homes, their pets, their furnishings out of my tax payments. That’s just gross.

  4. I’m in a similar position to you, in that I have a well-paid day job and any money I’d make from writing would be taxed at the higher rate. But that – for better or worse – is how our tax system works and what this arrangement gives me is the ability to support my family while I choose to also pursue an idealistic goal of creativity. And the key point is that it is a choice – as you so clearly pointed out in your last blog post. I choose not to get a lower paid job to reduce my tax burden and I choose not to give up trying to get published. It’s nice to dream about not being the main wage earner and being able to devote all my time (and tax allowance) to writing, but life isn’t fair and that’s just the way it is!

    Nick.

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