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Patreon Profits & Tax:
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Paying Taxes as an Artist on Patreon

For online content creators, Patreon is more than a crowdfunding platform; it’s a gateway to boosting income while embracing creativity. Whether you have a Patreon account or are considering setting one up, this platform empowers artists to receive donations from patrons and offer tiered subscription packages to fans.

However, despite the personal touch, any income from Patreon may be subject to Australian income tax. To avoid potential pitfalls and hefty penalties, seeking the expertise of a professional tax agent for accurate tax submissions and minimizing tax liability is a prudent step.

Do I have to pay tax on Patreon income?

As an artist and creator on Patreon, you offer a service to your fans. Even if you’re not sending them physical goods, they’re still receiving some form of value in exchange for their patronage. Therefore, Patreon subscriptions and donations count as income, just the same as actual sales of your work.

So yes, you are obligated to pay tax on your Patreon income. Unless you fall under the tax free threshold of $18,200 in a financial year, your earnings will be taxed at your marginal tax rate.

What if I’m using Patreon as just a hobby?

To cut it down to bare basics, if you’re starting your Patreon account with any intention of generating a profit, you’re running a business.

If you’re not expecting a profit but are carrying on business-like activities with regularity – such as tracking your income, planning your launches, and marketing your page – then you’re running a business.

Basically, it’s safe to say that by starting a Patreon for any other reason than to raise funds for a charitable cause, the ATO considers you to be running a business endeavour.

Membership Tiers

Offering exclusive content and perks to patrons who subscribe at different levels.

One-Time Donations

Patrons can make single contributions to support your work.

Digital Products

Providing downloadable content like eBooks, music, or art to patrons.

Physical Rewards

Mailing merchandise, prints, or other physical items to higher-tier patrons.

Custom Requests

Offering personalized content or services to patrons who pledge a certain amount.

Forms of Income on Patreon

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How to lower the amount of tax you have to pay

If the thought of giving up some of your hard-earned income at tax time leaves you feeling a bit deflated, there is a silver lining. You can offset any business-related expenses against your taxable earnings. This reduces the amount of tax you have to pay.

However, it’s important to make sure that the expenses you claim are solely used for business-purposes only. Alternatively, you can claim a percentage of an item that you use partially for your Patreon account, and partially for personal use.

What Expenses
Can I Deduct?

Anything you purchase specifically for the running of your Patreon may be deducted as a business expense. This could include things like –

  • Pencils, Paints, Canvas
  • Camera Equipment
  • Studio Hire Fees
  • Software
  • Training Courses & Workshops

Just make sure you keep your receipts, and track your expenses in a spreadsheet or ideally use accounting software. You’ll be thanking yourself for being organised when it’s time to do your tax return!

Client Success Stories

Michael Wilczynski from National Accounts handles my family’s personal income tax and all of my business requirements. I would 100% recommend and endorse his services to anyone. His service has always gone over and above my expectations. I found Michael through a recommendation through a friend and I have no doubt that my family’s financial situation has improved since we started using National Accounts services.

Ben Heide

National accounts have gone above and beyond by helping me with my court dramas and obtaining my mortgages. Much appreciated

Tyson Jack

My experience with National Accounts was fantastic. Michael arranged multiple tax returns for me in one go, he was really professional and always available whenever I had a question. Even though I only used him for my personal returns, I would highly recommend. They took the pain of doing my return and maximised the return I received. I will be going to them again next year, Thanks again.

Michael Hughes

We used National Accounts for our personal tax return this year and could not have been happier with the service we received. We have always completed our returns ourselves online but decided to get professional assistance this time after receiving great reviews from friends. We were extremely happy with this decision and the return we received. Micheal was extremely helpful and efficient – it was fantastic not having to stress about tax time. We are definitely looking forward to his assistance next year.

Kelly

No matter who we talk to at National Accounts, the whole team is fully aware of our business and accounting activities. They have been incredibly helpful and we couldn’t have asked for a better accountant. I recommend National Accounts to business associates all the time.

Dale Ross

I cannot recommend National Accounts highly enough! Michael, Nikki, Jane and Noreen are always on hand to help and quick to respond. Michael is an expert in his field with a wealth of knowledge. Nothing is too much trouble. We have been using National Accounts for years now and will continue to do so!

Kirsty Aldridge

I was referred to Mike at National Accounts over a decade ago and he has been our family/business accountant ever since. Mike’s team are efficient and responsive. Mike’s unerring advice and our trust in him means that he remains our Accountant despite us living in Victoria for the last 8 years.

Ian Aldridge

Working with Mike and his team at National Accounts has been an absolute pleasure! He is incredibly efficient, friendly, and down-to-earth, making the entire accounting process feel easy and stress-free. Mike’s expertise in tax planning and managing business structures is unrivalled, and he consistently provides practical solutions tailored to my needs. The team at National Accounts shares his friendly and efficient approach, making every interaction a positive and personable experience. I highly recommend Mike and his team for an outstanding accounting service that combines professionalism, expertise and a down-to-earth attitude.

Rhys Barber

As a psychologist, it has historically been difficult to find an accounting service who took the time to sit down to understand the profession and explain how I can get the most out of my taxes. However Michael has really taken the time to ensure that I receive the maximum benefits from my return and his suggestions will only improve my practice further. His professionalism and dedication to his clients should be praised. I would highly recommend to all those looking for a great accountant.

Phung Ngo

National Accounts are a true partnership. Its like having a team of accountants and advisors in the next office. I have been a loyal customer for over 6 years and they have supported and advised me through the myriad of compliance and tax issues during that time. Mike, Jane and Nikki are super responsive, fast at dealing with issues and incredibly cost effective.

Brendan Nicholls

FAQs

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