As a content creator, you are most likely self-employed. Therefore, it’s extremely important that you learn to manage your own money. That becomes a lot easier when you learn a few simple rules of finance.
These are the accounting basics every YouTuber should know.
Keep a record of all your earnings.
When tax season comes, you’ll be required to report every cent you’ve earned. This includes ad revenue, sponsored content fees, merch sales, affiliate commissions, and any other income you’ve earned through work. To make things easier on yourself, keep a log of all your earnings.
Save you invoices, bank statements, and other financial records. Keep them organized so that you can find them easily when necessary. As a backup, you may want to create both digital and print versions of your records.
Learn what expenses can be written off.
Self-employed people generally have to pay more taxes than those who are regularly employed, but you can lower your taxes by finding write-offs. Certain business expenses can be classified as write-offs. They’re generally expenses that help your business run, such as certain utility bills. These vary by country, so be sure to check your local guidelines.
Additionally, you should research tax deductions. These can definitely help lower the amount you owe. You might be eligible for certain tax breaks depending on your region and industry.You may want to consult with a professional account just to be sure. For example, a region that offers a tax break for local film productions may not classify YouTube videos as films.
Separate your personal and business finances.
Filing your taxes will be much more manageable if you keep your personal finances separate from your business finances. That way, your records will be clean and organized, and you won’t have to through receipts and bills line by line.
An easy way to separate your finances is to create two separate bank accounts. Only use your business account to purchase camera equipment, pay video editors, accept payment from sponsors, and conduct other financial matters related to your channel. Then, transfer money from this account to your personal account for household bills and discretionary spending.
Money management is an important skill for any creator who wants to be successful. Start with these accounting basics so that you can stay on top of your taxes and expenses.
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Kristen Harris enjoys listening to a wide range of music, from Taylor Swift to, on occasion, Celtic instrumental. She also spends her time writing, reading, and baking.
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