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akmacca
01-23-2010, 02:17 AM
I know what a boring subject! But I need to ask.

I am an Australian living in Canada, but still an Australian resident for tax purposes. Whilst In Canada I can not work so I have turned to writing. I have completed the book and almost finished the edit and in a month or two I will be in a position to seek an agent ect.

My tax question is does anyone out there know if there are any deductions I can claim due to my writing?

For example if I was to pay a professional to edit the book would that be a tax deduction?

Whilst not earning an income here in Canada any possibility of a refund around tax time would be a boon.

Cheers

Mac H.
01-24-2010, 01:12 PM
Are you paying income tax in Australia this year?

If not, then how will you get a refund on the extra tax payments you have paid so far ?

Remember - a refund is basically a refund of EXTRA tax payments you have made over the accounting period. So if your income was calculated at $40k, tax payments were taking out by your employer that were suitable for that level.

However, if it turns out that you were really earning $30k after consideration of your deductibles, you get a refund of the additional payments.

As a writer/artist you can apply a longer accounting period than a single year. So when your book finally sells and you have an income of (say) $30k for the year, you tick a box on the tax form to say that you are applying the previous five years of deductibles.

However, from memory you will apply this when you actually start earning money from your writing - it is pointless applying it earlier because you will just lose out. (If you apply the deductibles this year than you obviously can't apply them next year as well!)

Deductibles include professional society memberships, and any expenses made solely for the purpose of earning your income (except for travel to and from your regular place of employment).

Obviously you need to get proper tax advice - this is just from my memory.

Mac