Understand contractual obligations and finical issues in freelance

work in the creative media sector

A contractual brief is a contract between two people that states

what needs to happen and when it will happen. It outlines the duties
and responsibilities and will include things such as deadlines, which
have to be met. A contractual brief is a lawful document and if is
broken, further action can be taken. However, if the client would like
to make changes the freelancer can either say no, its not in the
brief or can negotiate around the brief but can also ask for more
money from the client. An example of a freelancer who may use this
is a wedding photographer. They will have an initial contract that
will fit all customers but will make amendments per each client. The
client and photographer will both sign the contract and a deposit will
be taken, this secures the contract and the brief will have to be
followed.

When becoming a freelancer there is many things you need to pay

out, whether this be personal expenses or things you may need to
maintain your work.

Personal (prices per year)

- rent
- car insurance 600
- food 1.5K
- gas
- electric (utility 800)
- wifi (240)
- tv licence
- leisure (8K)
- phone bill (360)

Work
- cameras ( service 300)
- website (1,800 to 6,700)
- tripod (300)
- macbook
- editing suite 603 a year
- microphone
- clothing
- lenses
-
overall: 17,703 yearly average

- Cameras will need servicing.

- SD cards
- Hosting on website
- 20K
 - Personal appearances will be extra money.
- 114.4K 1.8M estimated yearly earnings
- publish a book to earn extra money.

want to make 50K average

- 17, 703
= 32, 297, before tax.

As a YouTuber, to make money you can do advertisements

for companies; this is one of the ways to make money.
Here are some examples of how this works:

BambinoBecky: This is an advertisement by Ikea where she was

sent their products and was paid to make a video promoting the
range. As Becky is only a small YouTuber she would have got around
500 for this but bigger YouTubers can earn a lot more than this.

Hannah Rene: This is an advertisement by Rimmel where Hannah

would have been sent a variety of their products and asked to make
a makeup tutorial in order to promote the brand, hoping her
audience will go and buy what they see. Hannah would also of been
paid for this promotion.

YouTubers also make money from monetization, this is where they

add adverts before and during their videos and are paid a small
percentage of money. Earnings will depend on a number of factors.
The two key factors are the type of ads and the pricing of ads
appearing with your videos.

Some YouTubers also release books and go on tours in order to make

more money. Some of these books have made it into the bestseller
charts which creates extra money.

Profit: a financial gain, especially the difference between the

amount earned and the amount spent in buying, operating, or
producing something.
- Get tax off profit
- Higher expenses, lower profit, less to pay to tax man
- Expenses: car, studio, more equipment

Income Tax is a tax you pay on your income.

You pay tax on things like:
- money you earn from employment
- profits you make if youre self-employed - including from services
you sell through websites or apps
- some state benefits
- most pensions, including state pensions, company and personal
pensions and retirement annuities
- rental income (unless youre a live-in landlord and get less than
the rent a room limit)
- benefits you get from your job
- income from a trust

Pay As You Earn (PAYE)

Most people pay Income Tax through PAYE. This is the system your
employer or pension provider uses to take Income Tax and National
Insurance contributions before they pay your wages or pension.
Your tax code tells your employer how much to deduct.

Self Assessment tax returns

If your financial affairs are more complex (for example youre self-
employed or have a high income) you may pay Income Tax and
National Insurance through Self Assessment. Youll need to fill in a
tax return every year.

Earn 32,297 in 2017/2018 and you'll take home 25,243. This

means 2,104 in your pocket a month.
Over the year you'll pay 4,158 income tax and 2,896 in
National Insurance.

You pay National Insurance contributions to qualify for certain

benefits including the State Pension.
You pay National Insurance if youre 16 or over and either:
- an employee earning above 157 a week
- self-employed and making a profit of 6,025 or more a year
You need a National Insurance number before you can start paying
National Insurance contributions.

VAT
Earn under 84K, spend more on the business.
The standard rate of VAT increased to 20% on 4 January 2011 (from
17.5%).
Some things are exempt from VAT, eg postage stamps, financial and
property transactions. The VAT rate businesses charge depends on
their goods and services.

VAT is a tax charged on sales made. A VAT registered business

therefore has to charge VAT on sales, but can reclaim VAT on
purchases made from other VAT registered businesses.

The basic rule is that you must register for VAT if your VAT taxable
turnover (that is, the total value of everything you sell that isnt VAT-
exempt) is more than 83,000 in a 12-month period.

However, less well appreciated is the fact that you also have to
register if you receive goods in the UK from the EU worth more than
83,000, or you expect to go over the threshold in a single 30-day
period (even if the value at the end of the 12 months is less than
that).