Musicians, Artists & Accountants

Here at Linda McGowan Pty Ltd we have been providing accounting, tax and financial planning solutions to musicians and artists for over 15 years. Our clients span the whole musical spectrum - solo recording artists, bands, songwriters, publishers, studio musicians, freelance classical musicians, well known pop groups, music and instrument retailers plus small record labels.

While you won't find Linda McGowan's face on the front of a CD cover, she always strikes the right note with her musician clients. In fact, the music industry has become a real niche area within the practice. Her in depth knowledge and understanding of the industry stems from her husband's long term involvement in a band spanning several decades. She recognises that you invest heavily in your craft and that your world is evolving with uploading music to the internet and virtual distribution costs with itunes, mp3 and cdbaby.

We are not your average accounting firm that just keeps the score. We aim to convert your creative capabilities into profits and make your financials more meaningful. Our extensive knowledge of the music industry has enabled us to develop a portfolio of services that meets the exact needs of our niche clients.

She has personally mentored hundreds of business start ups including dozens of artists and musicians. Linda says, "The harsh reality is that enthusiasm, money, talent or a great idea is not enough to guarantee success in the music business. Like a chess game, to succeed you need to make the right opening moves and we are passionate about helping musicians and artists make the transition into their own business.".

Having previously assisted so many musicians and artists we would like you to benefit from our experience and help you make the right opening moves. It all starts with the question, are your activities a business or a hobby? Sometimes the lines are blurred and the ATO have established criteria that we can share with you at a meeting in our Brunswick offices.

When establishing your business it's important to seek sound professional advice from qualified accounting and legal sources. Your business success is important to us because Small Business is Our Passion. To support this claim and to help our clients starting or buying a small business we have produced a valuable booklet that contains information on a number of topics including :

• Choice of Business Structure
• Tax and Business Registrations
• Buying a Business
• Record Keeping Requirements
• Accounting Software Options
• Business Insurances
• Employer Obligations
• Legal Issues
• Permits & Registrations
• Claiming Motor Vehicle Expenses
• Preparing a Business Plan
• Preparing a Cash Flow Budget
• Vehicle & Equipment Finance Options

Accounting Software For Small Business

One of the biggest mistakes small business owners and musicians make is that they purchase accounting software beyond their business needs and level of accounting skill. This can lead to considerable frustration and records that amount to nothing more than a 'computerised shoebox'.

Record keeping is a serious issue and a big hurdle for musicians who are often touring and doing gigs around the state, country or world. With so many software options available it is easy to become confused because they range in functionality and sophistication with a price tag to match. It's fair to say the majority of musicians and performing artists know very little about accounting. For this reason we generally avoid double entry accounting programs that require an understanding of debits, credits, journal entries and the distinction between assets, liabilities, income, expenses and equity. Instead, we recommend one of the country's most popular bookkeeping programs, Cashflow Manager.

It looks and operates like a manual cashbook complete with a spreadsheet or column layout and at around $249 it could save you thousands in accounting fees over the life of your business. You can expect to be up and running in just minutes and you won't need to undergo lengthy or expensive training courses. You can have multiple bank accounts in a single business and the comprehensive reports explain your business results and make preparation of your BAS very easy.

Reconciling to your bank statement is very simple and the program includes the debtors side of 'Invoice Manager' that lets you generate Tax Invoices and track your debtors to produce Statements.  If you have staff you can add 'Wages Manager' to process pays, print payslips, Annual PAYG Payment Summaries and also track staff entitlements.

We will sit down and discuss your individual needs from the outset and simplifying your bookkeeping enables us to deal with your taxation affairs in a highly efficient and cost effective manner. This simple but often overlooked strategy could save you thousands of dollars over the life of your business.

What can you Claim?

Generally speaking if you are running a business you can potentially claim expenses 'necessarily incurred in deriving your assessable business income' including :

• Musical Instruments*
• Equipment* & Accessories (amps, pedals, effects, straps, carrying cases)
• Consumable Supplies (such as drum skins & sticks, guitar strings & picks)
• Music Business Books, Record Company Directories, Venue Directories
• Subscriptions to Trade Magazines
• Travel & Gigging Costs
• Sheet Music and "How-To" Books and Manuals
• Promotional - CD/Tape duplication (for demos), photos, bios
• Office Supplies & Stationery - paper, envelopes, photocopies, stamps
• Fees related to maintaining your website and e-mail access for your music-related activities
• Rent for storing your gear and for your practice space
• Membership of Professional Bodies including Associations & Unions
• Professional Fees (Solicitor, Manager, Agent and Accountant)
• Copyright and Registration Fees
• Lessons & Instruction
• Travel & Accommodation Expenses
• Home Office/Studio Expenses

* Some of these expenses are fully deductible while others must be depreciated and claimed over a number of years

The musician's world is fascinating for an accountant because of the potential different sources of revenue including publishing, recording, merchandising and touring. We know that the small struggling band could be tomorrow's star but it all starts with the right opening moves.  Talk to us today about 'taking care of business'.