MicrostockGroup
Microstock Photography Forum - General => General Stock Discussion => Topic started by: spike on February 05, 2016, 12:16
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I understand this is a complex issue which is also affected by your situation (are you employed, married, etc.), but I'd like to see the estimate of what percentage you pay due to taxation.
In my case, tax is pretty bad, and (in my microstock earnings bracket) accounts for roughly 45% of "lost revenue". I mean, for each 1000 USD that I make on microstock, I need to pay around 450 USD for taxes.
That's crazy, and I'm actually thinking of relocating due to that. I'm in the EU.
What's your situation, what chunk of your microstock income do taxes eat?
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I have a day job too so micro pushes me into higher tax brackets, I pay roughly 38 percent when I add federal and state taxes.
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Taxes are kind of a loaded question. I probably only write a check to Uncle Sam for about 20%, but that doesn't include health insurance or other perks that higher taxes might get you in another country. I live in a state with no state income tax, but that might mean I pay more in property tax or sales tax than another state. I'd say if you are planning on moving to look at all the factors.
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In my case, tax is pretty bad, and (in my microstock earnings bracket) accounts for roughly 45% of "lost revenue". I mean, for each 1000 USD that I make on microstock, I need to pay around 450 USD for taxes.
I am not a tax expert, but that sounds awfully high. Here's a tax bracket calculator.
http://www.moneychimp.com/features/tax_brackets.htm (http://www.moneychimp.com/features/tax_brackets.htm)
The highest tax they have is 39.6% and this for someone making over $413,200. Hope this helps.
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In my case, tax is pretty bad, and (in my microstock earnings bracket) accounts for roughly 45% of "lost revenue". I mean, for each 1000 USD that I make on microstock, I need to pay around 450 USD for taxes.
I am not a tax expert, but that sounds awfully high. Here's a tax bracket calculator.
[url]http://www.moneychimp.com/features/tax_brackets.htm[/url] ([url]http://www.moneychimp.com/features/tax_brackets.htm[/url])
The highest tax they have is 39.6% and this for someone making over $413,200. Hope this helps.
"That's crazy, and I'm actually thinking of relocating due to that. I'm in the EU."
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There isn't one EU tax scale, but for comparison, I'm in the EU / UK, and now that I've quit my day job, I'm back on basic level tax, so 20% - minus various allowable tax expenses which I let my accountant deal with.
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Though Belgium is considered a HEAVY taxing country, this does not go for royalties. Royalties are not added up with other income in Belgium, and as a result I pay 15% on my stock income (and a lot more on my other photography income).
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There isn't one EU tax scale, but for comparison, I'm in the EU / UK, and now that I've quit my day job, I'm back on basic level tax, so 20% - minus various allowable tax expenses which I let my accountant deal with.
That's just income tax. The UK also has national insurance, council tax, VAT, capital gains tax, road tax, the highest tax on fuel imaginable, inheritance tax, customs duty, stamp duty when you sell a house and I'm not sure that's all of them.
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There isn't one EU tax scale, but for comparison, I'm in the EU / UK, and now that I've quit my day job, I'm back on basic level tax, so 20% - minus various allowable tax expenses which I let my accountant deal with.
That's just income tax. The UK also has national insurance, council tax, VAT, capital gains tax, road tax, the highest tax on fuel imaginable, inheritance tax, customs duty, stamp duty when you sell a house and I'm not sure that's all of them.
You forgot car tax ? Water tax ? Waste tax ?
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
You're not making any money then are you?
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There isn't one EU tax scale, but for comparison, I'm in the EU / UK, and now that I've quit my day job, I'm back on basic level tax, so 20% - minus various allowable tax expenses which I let my accountant deal with.
That's just income tax. The UK also has national insurance, council tax, VAT, capital gains tax, road tax, the highest tax on fuel imaginable, inheritance tax, customs duty, stamp duty when you sell a house and I'm not sure that's all of them.
But these are taxes I'd need to pay anyway; this thread was specifically about tax we pay on our microstock income (I'm a small fish, under the line for self-employed NI).
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There isn't one EU tax scale, but for comparison, I'm in the EU / UK, and now that I've quit my day job, I'm back on basic level tax, so 20% - minus various allowable tax expenses which I let my accountant deal with.
That's just income tax. The UK also has national insurance, council tax, VAT, capital gains tax, road tax, the highest tax on fuel imaginable, inheritance tax, customs duty, stamp duty when you sell a house and I'm not sure that's all of them.
But these are taxes I'd need to pay anyway; this thread was specifically about tax we pay on our microstock income (I'm a small fish, under the line for self-employed NI).
Other countries have higher income tax that looks bad to us in the UK but they don't have some of the other taxes we pay or they are at lower rates. I think governments around the world have made all these different taxes to make it as complicated as possible and to try and fool us in to thinking they haven't raised taxes. Successive governments have known the voters don't like a rise in income tax, so they raise national insurance or VAT or some other tax.
The OP mentions relocating to avoid high taxes but I think that only looking at income tax isn't the way to do it, you have to look at all the taxes to work out if it is worthwhile relocating.
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
You're not making any money then are you?
The difference with travel photography/videography as opposed to home based is the amount of expenses you can deduct. So whether or not someone is making money would depend how you look at this aspect.
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The OP mentions relocating to avoid high taxes but I think that only looking at income tax isn't the way to do it, you have to look at all the taxes to work out if it is worthwhile relocating.
Not necessarily. Once can be a tax resident at one country, and spend that money in a cheaper country which has higher taxes (but you don't care because you pay a low rate in a different country).
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
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Just over 0%.
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
If you travel for work, then all expenses can be claimed.
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
If you travel for work, then all expenses can be claimed.
Good luck in convincing the IRS to accept all you vacation expenses only because you snapped a few photos here and there!
They are not fools and photographers are a known target for a thourough scrutiny.
Sent from my SM-N910T using Tapatalk
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
If you travel for work, then all expenses can be claimed.
Good luck in convincing the IRS to accept all you vacation expenses only because you snapped a few photos here and there!
They are not fools and photographers are a known target for a thourough scrutiny.
Sent from my SM-N910T using Tapatalk
Definitely where people get into trouble. Just met with my accountant and as usual we vetted any travel expenses and honed them down to a level that he feels won't raise flags. The IRS is very sensitive to travel and camera gear. It is wise to be wise indeed.
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Just over 0%.
Where?
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
If you travel for work, then all expenses can be claimed.
Good luck in convincing the IRS to accept all you vacation expenses only because you snapped a few photos here and there!
They are not fools and photographers are a known target for a thourough scrutiny.
Sent from my SM-N910T using Tapatalk
It may depend what country you're in. And there's a big difference to someone taking a holiday and taking a few snaps to try and justify some expenses as opposed to a full time travel photographer who is on the road indefinitely. Professional full time travel photographers who are never at home are not taking holidays as you put it, they are going about their profession. There is a big difference between the two.
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Just over 0%.
Where?
Google it. ;)
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If you're a travel photographer you can claim all of your travel expenses. So by the tie you subtract your expenses from your income there is often no tax to pay at all.
I'm afraid you won't be able to claim your vacation to Rio, in case you plan to.
Maybe only a small part: expenses strictly related to photography.
If you travel for work, then all expenses can be claimed.
Good luck in convincing the IRS to accept all you vacation expenses only because you snapped a few photos here and there!
They are not fools and photographers are a known target for a thourough scrutiny.
Sent from my SM-N910T using Tapatalk
Definitely where people get into trouble. Just met with my accountant and as usual we vetted any travel expenses and honed them down to a level that he feels won't raise flags. The IRS is very sensitive to travel and camera gear. It is wise to be wise indeed.
I checked with my accountant recently and he said I can deduct all expenses when I travel. Most of my travel days are arranged by what locations I want to photograph. And I often do skip things that I might do as a tourist but have no photo value. Guess I'll find out what the IRS thinks when and if I get audited.
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EU member state. The latest calculation from last week from one of our financial portals was on average 55% of income going to state - this includes revenue tax 20%, health insurance, social insurance, VAT 20% and some other smaller fees.
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EU member state. The latest calculation from last week from one of our financial portals was on average 55% of income going to state - this includes revenue tax 20%, health insurance, social insurance, VAT 20% and some other smaller fees.
I recommend you to move to Malta.
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Income tax I guess about 20% but then there are other taxes as mentioned. It's hard to work out. I am happy to pay them to live in a civilised country with a safety net for the most vulnerable. In fact I could have gone Ltd. a long time ago and saved about 10-12 usd a year but refuse to set up my company in a certain way just to lessen my tax bill. I prefer to concentrate on working harder and smarter to increase my income.
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Just over 0%.
Where?
US, I don't make that much yet and it is pretty easy to offset (honestly) with expenses. I don't claim a home office or travel, but I claim a small percentage of the allowed depreciation on my gear. Just enough to bring it down to a small profit. I also have a lot of expenses like PS etc that I don't claim but keep records of in case of audit.
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EU member state. The latest calculation from last week from one of our financial portals was on average 55% of income going to state - this includes revenue tax 20%, health insurance, social insurance, VAT 20% and some other smaller fees.
Dayum. 55% is just too much.
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Hello. I live in Romania, Europe. I live only from microstock. I am not an authorised photographer, this is just a hobby. I am not employed or else. I pay 16% from my income. Also, I pay about euro 14 per month for social health assurance ( about 173 euro / year). But this assurance taxe is paid by every people living here. This is the lowest price because my royaltyes from microstock are lower than the minimum salary/ year. Anyway, when I will go beyond the minimum salary I will pay 5.5% from my revenues. So, in my country, you can pay (16+5.5)% as a minimum. I can not deduct any expenses like buying photo gear or travel. If I want to deduct expenses related to photography I must autorise myself as a photographer. I don't know any other people from my country who are authorised photographers and work also in microstock. I think many of them elude tax declaration, but this is bad because some day IRS will send infos about them to local tax agency. I think this because I asked many time about taxes folks from my country but no answer. This is a prohibited subject here so I think nobody but me pay taxes :) If you live in Romania and have questions about this subject, please feel free toi ask me any questions.