It's important to capture and track your expenses related to gigging as part of our Musician’s Operational Excellence. Not only is it often a requirement for operating as a business entity, but it also helps with tax calculations and financial planning. However, there are additional reasons specific to musicians for keeping track of your expenses.
Over time, tracking your expenses will provide insights into your spending habits related to performing. It allows you to understand and anticipate upcoming costs, and allocate your income accordingly. Unless you have a consistent playing spot, you will likely have associated costs such as travel, insurance, website maintenance, social media promotion, consumables, and occasional purchases for new equipment as you expand your services and reach. Keeping records of your expenses helps you determine what you can or should be spending on and assists in making informed financial decisions.
It's important to note that each country has its own tax rules, and if you are set up as a sole trader, solopreneur, or business entity, seeking professional advice can help you understand tax efficiency strategies and benefits.
Moreover, the musician's need for expense tracking comes from using expense categories to predict annual spending, plan when to spend, and gain an outlook on what funds may be left over for investing in new gear or treating yourself.
Enjoy yourself (it’s later than you think) - Carl Sigman and lyrics by Herb Magidson 1949.
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