HOW TO ORGANISE YOUR FINANCES + PAY YOUR TAX BILL – Stripper Tips:

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Organisation is the key to good accounting and reducing your tax bill. There are some really good reasons to pay your taxes as a stripper. I outlined some of these reasons in my last post. Accounting can seem super scary, but all accounting actually is, is the recording of cash in and out. Learning these skills early in your stripper career is really important and will prevent you from copping huge fines, as well as prepare you to invest and stack your money higher than you ever thought possible!

Office Organisation:

So first things first, you need to create an organisational system and keep records of your money coming in – this is what goes in your bank account, and going out. For this we want to create a business binder.

What is a business binder?

A business binder contains documentation of money coming in and money going out, sorted monthly and recorded with proof (receipts). A business binder can help you calculate your finances, profits and losses each week, and keep you on top of your earnings, savings, financial goals and upcoming tax bills so that you are not caught out with any nasty surprises.

For my comprehensive guide on organising your finances, watch this video or keep reading!

EXAMPLE OF HOW I ORGANISE MY FINANCES:

 

Month Profit: Loss (tax deductible):
January week 1st – 7th

 

$900 – cash deposit $45.00 – boohoo lingerie purchase
January Week 8th- 14th

 

January Week 15th – 21st
January 22nd  -28th
January 29th – 4th FEB
GROSS BUSINESS INCOME:

 

  TOTAL INCOME AFTER DEDUCTIBLES:

 

 

Receipts and deposits:

Keep these and place them into monthly sections in your business binder. I like to use my free downloadable system which you can find at the following link. The downloadable system allows you to keep a running tally of profit and loss forms for a monthly total.

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HOW TO USE THE DOWNLOADABLE CE-HOE SYSTEM: 

The profit and loss form available at the link below in this blog post is designed to help you when the end of financial year rolls around. Taking one day out of each month, or week to file and record the earnings you have banked will help save you stress and money when doing your tax return as a CE-HOE. The following three steps will ensure the form is used correctly.

  • Simply record all cash deposited, and money spent on deductible items for each week of the month on the form (there are five rows in case it’s one of those odd-fortnight months). Add up your total recorded income, and total deductible income and record this also.
  • Keep all your receipts detailing cash deposits banked from your income as a stripper, and all tax invoices from deductible expenses with the respective monthly profit and loss sheet (I recommend using a binder method, and making sure income receipts versus deductibles are clipped together in separate piles).
  • Take your twelve months’ worth of super organized recordings to a sole-trader friendly accountant (almost every accountant out there should be able to help you!) and have them calculate your tax bill and/or return!

 

Some tips for your organisation (run-through):

  • Don’t place receipts in plastic sleeves – the ink can wear off reducing readability – a receipt is invalid as a deductible if it cannot be read. I combat this by placing a paper label over each of my clipped receipt piles reading ‘in’ and ‘out’.
  • Do file receipts for deposits (cash in) throughout the month in one pile, and receipts for cash out (deductibles) in another respective pile. I just clip mine to either side of the monthly page. I find that easiest.
  • DO keep an online record of money in and out (receipts) I use two email folders for paypal purchases given to me by customers, and of course, online lingerie purchases I can claim as deductibles.
  • DON’T get caught up trying to track all of your daily, personal expenses. You can’t claim most of them back and a business binder is for your tax-specific profit and loss. Your business expenses and total income.
  • I keep the most recent month at the top of the pile of paper working backwards. The ATO requires small business owners to keep five years worth of records ( i.e. if you’ve been dancing since 2010 you would need records from 2013 to present).

Saving for End of Year Tax Bill:

Some people like to save for their end of year tax bill by creating a separate account which they pay quarterly, or annually. Being aware throughout the year of how much money you have earned and how much you will be able to write-off in total deductibles will help you estimate your annual or quarterly tax bill and ensure there are no nasty surprises!

 

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HOW TO CALCULATE YOUR TAX BILL:

AUSTRALIAN RESIDENTS ONLY:

Taxable income begins at $18,201 with 19c in tax owed per dollar earned above $18,200

This means if you live in Australia and you earned exactly $18,201 in one year you would only owe 19c in tax.

If however you banked $500 per week across the year you would have earned $26,000.

So to calculate the tax bill for a sole trader earning $26,000 per year we would follow this method:

$26,000 –

$18,201

= $7,799

Then:

$7,799 x

$0.19 =

$1,481.81c

 

Congratulations, Australian strippers, you just worked out your tax bill. The deductions you then claim will reduce the bill further.

You can also use this ATO guide to calculate: https://www.ato.gov.au/Calculators-and-tools/Host/?anchor=STC&anchor=STC#STC/report

If you are on a working visa or need to research a different tax bracket follow this link: https://www.ato.gov.au/Rates/Individual-income-tax-rates/ 

AMERICAN STRIPPERS:

Tax bill calculators are prevalent across the internet and I would recommend finding one designed for sole traders and LLC’s in the U.S. to help you understand your tax bill further.

So come tax time you should have organized your tax folder, kept your receipts for cash flow in and out, and documented these all in a folder organized into monthly sections. All that’s left for you do to when it comes to filing your tax return is to take this information to an accountant and pay up.

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GET YOUR FREE DOWNLOADABLE:

CEHOE DOWNLOADABLE PROFIT AND LOSS FORM

HELPFUL LINKS:

Tax Write-Off Cheat Sheet for Strippers!

Hi guys! Welcome to my first installment of my stripper finance series. I like to call it the financial diet for CE-HOES. I’m here to help you work out your finances as an entrepreneur and make the most of your stripper cash! If you’ve been working in the adult industry for a few months you might have noticed there’s not a huge amount of help out there for dancers who need to record an income for all sorts of reasons, like renting homes! I’m here to help you work that out, and tell you how to make the most of your tax return as a dancer. At the end of this post I will also provide a link to a free-to-download form that can help you remember what receipts to save to make the most of your deductibles.

I came by this knowledge because I have background in financial journalism, and before I became a full-time hoe I ran my own journalism business as a freelancer for five years. I then worked as a researcher for a higher education consultancy company, where we created accounting and financial degrees for universities across Australia. I also have a passion for finance, research and business. So without further ado, let’s sort out your stripper taxes!

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HOW DOES THE TAX MAN DEAL WITH HOES?

A stripper or dancer is defined as a sole trader or independent contractor because we do not earn a wage, and we do not typically employ others to maintain our business.

Before becoming a dancer in Australia you will need to create an ABN – An Australian business number. If you are American and plan to claim tax you will need to contact the IRS and research whether or not you need to register a business as a sole trader. Creating an ABN will NEVER cost you money, make sure you’re using government websites to register yours.

The reason you need an ABN – or other taxation identification – is because without one, any money placed into your bank you would then owe half of to the government. With an ABN you simply calculate your earnings within one tax year to work out what your tax bill would be according to your financial threshold. If you are under a certain amount of earnings you may be placed in an income bracket that gives you a lower tax bracket or none at all.

Banking your money is important because it legitimizes your business and helps you apply for rent, credit cards, home loans and other important stuff. It also teaches you valuable business and accounting skills if you plan to keep hustling into other industries.

Usually anyone with an income under $20,000 per tax year won’t pay any tax, although this varies between states and countries and industries so again, you will have to contact your national tax agency to check up on tax thresholds. Australian residents can check the following link to see where they fall in the bracket:

https://www.ato.gov.au/Rates/Individual-income-tax-rates/

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WHAT YOU NEED TO KEEP A RECORD OF:

*Receipts for deductible expenses – we’ll get there in a second

*Receipts for cash deposits into your bank

*Receipts for bPay or online deposits – I keep all my paypal and MFC receipts in a folder

 

WHAT CAN YOU CLAIM BACK?

This information is surprisingly easy to find. A quick google search for ‘taxable expenses for strippers’ led me to the ATO’s list of approved work-related expenses. So, here’s what you can claim:

  • Child care
  • Clothing – specifically costumes, pole shoes, and lingerie. You can’t deduct other clothing, but lingerie and costumes for stage shows will have you in the clear
  • Consumables – full service sex workers can claim for consumables like lubricant, but this doesn’t really apply to strippers.
  • Cosmetics – There are certain brands of cosmetics that count as stage makeup available in department stores – like Kryolan – but there are some brands that aren’t considered stage makeup and therefore you can’t claim as a business expense. A makeup artists own brand is more likely to be considered professional-grade and thus taxable than general drugstore makeup. However it’s always necessary to check.
  • Fitness – You CANNOT claim your general gym membership back, but you CAN claim dance classes, circus classes, and anything that introduces a new skill solely for your business. So keep those pole and aerial silk receipts girls!
  • Advice – you can claim back any costs incurring by referring to a tax agent for business or legal advice. You may also claim deductions for costs preparing tax returns.
  • If you use a phone to operate your business or advertise you can also claim a percentage of your phone bill back. The link in the description will take you to an ATO webpage that details how to claim back percentages of phone bills, and also offers further advice to strippers and full service sex workers!
  • Transport – if you travel different places for work – i.e if you drive or taxi or ‘uber to private functions as a stripper hired out by a company you may be able to deduct these, so always keep a receipt!

 HELPFUL LINKS:

 

YOUR FREE DOWNLOADABLE:

TAX DEDUCTIBLE CHEAT SHEET – click to download or save below.

tax write off cheat sheet