Tax Issues Every Freelancer Should Know

If you work exclusively from home, did you know that you can get a home office deduction for taxation purposes? To qualify, you must use your room solely for the purposes of your business, and even if you are using part of a room, this must also be exclusively for the purpose of work.

The other main thing to note here is that your home office should be where you conduct the majority of your business from. It doesn't matter if you visit clients at their location or meet up elsewhere, as long as you are using your home office as your main place of work.

Other things which are tax deductible include:

• stationary
• computer, laptop and anything needed to run your office such as a printer, fax and scanner
• office equipment including chairs and lamps
• phone expenses including your mobile as long as it is used exclusively for business
• postage costs
• travel and entertainment
• travel expenses for your car (you can claim on mileage, but check with your Country's tax office to get the correct amount per mile)
• cost of professional memberships, attending conferences and any fees for writing related organizations
• health and medical insurance for yourself and your family
• courses you take to improve your writing and business skills

A simple rule is this: if you have bought something for your business (including books and resources), keep your receipts and log your expenses. You can always check with your local tax office who will be able to guide you further.

If you want to do your tax returns yourself, then ensure you use a simple book or ledger to note all incoming and outgoing expenses. You will need an accountant once your earnings are over a particular threshold, but again, this varies depending on where in the world you live.

Boring yes, but a necessary pain to talk about!