The Business Side of Folk

Do you want to be legit. Or part of the black economy?
 
Income Tax & Accounts
National Insurance – exemption for small income
Public Liability Insurance
Instrument Insurance
Car Insurance
Planning regulations
Marketing & Pricing
Performing Rights & Copyright Issues
Licensing
Risk Assessment

 
DISCLAIMER: Everything on this page is believed to be accurate, and written in good faith, but if in doubt please take independent professional advice. Glosfolk or the writer can in no way be held responsible for any errors or omissions. We would be glad to hear of any additional information that may be of use to Glosfolk performers.

Income Tax & Accounts
All
income is legally liable to Income Tax. So you need to add profit from your folk activities to your tax return. To calculate your profit, take allowable expenses away from income. Hmrcs has free guides to allowable business expenses.
You need a simple profit & loss account. Expenses are either ‘direct’ so much for each gig (say travelling) or ‘indirect’ (say insurance, instrument repairs) I total up all my indirect expenses for the year, and divide by the number of gigs. Normally you do not need to employ an accountant, you can use the simplified form of tax return (unless you are going to earn mega-bucks!)
Hint: hmrcs expect you to make some money from your hobby, so do not try to over inflate your expenses. You are given a tax free allowance, but you may well be using that for your day job, or for your pension. Hmrcs web site is here
 
National Insurance – exemption for small income
Even if you pay National Insurance for your full time job, you are liable for Class 2 contributions on your Self Employed activities. However you can claim exemption if your earnings are classed as ‘small’ (currently less than £5315 ) Details here. Of course if you are over 65 you do not pay National Insurance (60 for women at present).
 
Public Liability Insurance
Morris Organisations can provide this, membership of EFDSS, Musicians Union, or Equity includes it. (However EFDSS need to be notified of every gig) I use Musicians Insurance Service of Matlock, very helpful, and very competitive. (£65 pa for £5M cover) Their web site: Here
 
PAT (Portable Appliance) Testing
Many venues want to see that your PA has been tested. Your friendly local electrician may do this for you for a few pounds, labelling each item, and providing you with a certificate. You do not have to test your equipment every year, the test certificate will have on it the recommendation of the electrician of the date of the next test, depending on use etc.
 
Instrument Insurance
Can be quite expensive if you have lots of gear, usually does NOT cover losses from vehicles. Again I use Musicians Insurance Service, and adjust values each year
 
Car Insurance
Does your vehicle insurance cover business use? You may invalidate if it is only ‘Social, Domestic, and Pleasure'.
 
Planning regulations
Are you running your business from home? And maybe claiming use of home as a business expense? Do you need or have consent for this? Nosey neighbours may report you!
 
Marketing & Pricing
How much do you charge? Only two methods of deciding. There is ‘Cost Plus’ which involves calculating the costs for each gig, then adding a percentage of ‘profit’ or notional wages (How much an hour are you worth? Minimum wage is about £6 per hour)
The other is ‘Market Forces’ How much will people pay? Probably more for weddings than Village Hall do’s
However if your ‘cost plus’ price is more than your ‘market force’ price than you cannot afford to accept the gig! More on this Here
How do you advertise? A proper web site is a must, there are lots of free hosting providers, so need not cost anything, except the domain rental. Use of social media, Facebook, Twitter, Youtube, etc, seems to work for lots of people. We have found that running off some fliers with basic info and a picture, and giving them out at every gig, (put them out on the tables) works very well indeed. Other good publicity methods include putting up some videos on 'Youtube' (make them quite short to save time when uploading), and making Demo CDs to give out or sell at performances. (You can get perfectly acceptable results with quite basic equipment - you only need to get a professional quality job for broadcasting) For barn dances, our band make a video of every dance (Concentrating on the audience, not the band) and send the resulting DVD to the bride (or other booker) after the event. Results in a surprising number of repeat bookings, and also lots of grateful thanks! If you regularly have repeat bookings, then many performers find a regular newsletter with details of what they have been up to, keeps people in touch. These days can be an e-mail so no cost, but even if you have to run some off and post to your mailing list can be quite economical.

Performing Rights & Copyright Issues ©,
If you play tunes or songs composed (and arranged in some cases) by someone who owns the copyright of them without their permission, you might be infringing their intellectual rights. Even traditional songs/tunes copied from a classic interpretation might come into this category. However traditional tunes, and tunes/songs composed by people who died more than 70 years ago are generally out of copyright in the UK (eg: 'Waltzing Matilda' composed by Banjo Patterson is now (just) out of copyright, as is 'Sally Gardens' by WB Yeats.)

Some people think it is worth  joining PRS. It the venue that is licensed by PRS to play music, not the performer.  To put on an advertised music session costs approx £9 per session. In theory these licence fees are distributed to composers annually, but in practice only a very few people get any real money! Find out more HERE  or HERE 

The position with images (Pictures, photographs etc) was very similar, but The  Enterprise and Regulatory Reform Act (just given Royal Assent) may change that. The Secretary of State can give permission for 'orphan' images to be used freely. More on this will become clear later this year as the various Statutory Instruments are approved by Parliament.

Do you need to protect the name of your band or group? Register as a Business name? The ceilidh band Stömp were forced to add the umlaut to their name, because another band had registerd as 'Stomp' and threatened them with legal action!

Licensing
Under current legislation, if what you do is classed as 'entertainment' then the venue (not you) needs a licence. The Live Music Bill  came into force on 1st October 2012, and this has had the effect of relaxing this regime to some extent. Small gigs now often do not need an entertainment licence. Any music on licensed premises is be OK up to 11pm, 200 max audience amplified, unlimited audience unamplified. Music on any premises classed as 'workplaces' is also be OK  (same audience limits) workplaces will certainly include schools, factories, offices, and any village hall that has an employee (a cleaner?) Some councils have licensed Open Spaces - More details HERE  

Risk Assessment
This is simply  a list of all the possible hazards that might arise, a classification of the risks of each - low, medium. or high - and ideas of how  the risk could be avoided altogether, or minimised. I have a simple form for busking RISK ASSESSMENT FORM.doc  and one for barn dances  RISK ASSESSMENT FORM - Ceilidh or barn dance.doc  I did not include the danger posed by hanging baskets to buskers, but will do in a future issue!

©Peter Cripps 2012
 HERE





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