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June 29, 2007

A Concert in Support of Willie P. Bennett

PiggybankMy friend Jeannine Taylor over @ QuidNovis.com is one of the sponsors for this concert, so I wanted to do my bit by spreading the word about this special event. Besides, as a self-employed author, I'm all-too-aware of how financially perilous it can be to pursue a career as a self-employed anything, let alone a self-employed creative type. Sometimes you have to rely on the kindness of friends and relatives to weather the lean times in your business, whether that is at startup or during the financial hiccups that can occur during times of illness or family strife. (This is why organizations like The Writers' Union of Canada have been lobbying the Federal Government for years to allow income tax year back-averaging for creators. But I'll leave that subject for another day.) For now, find out about the concert for Willie and enjoy some great music while supporting a great cause.

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Comments

Hi Rabbit -

Yes, you can incorporate (and I am incorporated, actually), but incorporation is expensive ($1500/minimum) and the annual costs of hiring an accountant to file federal/provincial corporate tax returns are another ongoing expense ($2000). Given that that average income of a Canadian writer is around $26,000 ( http://www.cfunion.ca/ ), this is not a viable option for most writers.

Here's another oddity of the Canadian tax system: book royalty income is not treated as earned income. It's treated as dividend income that you might receive from a corporation. This means that a writer can have difficulty writing off expenses if his/her only income in a given year is royalty-related.

And given that rates have been stagnant or declining for over 25 years and both magazine and book contracts have never been worse -- it's a tough time to be a Canadian writer.

Ann

Can a writer create an incorporated business to market their books?

And if so, wouldn't the tax code for incorporated business allow the sort of the thing you are talking about (e.g., capitalization of expenses and carry forward of losses)?

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