What is different about tax for actors
Very few actors have one employer and one payslip. A typical year might include a theatre run, a few days on a TV drama, a commercial, some voiceover sessions and corporate role play, each booked by a different engager and often through an agent. That pattern is the reason tax for actors works differently from most jobs.
HMRC's own guidance says most actors and other performers are self-employed. It looks at the pattern of your engagements, whether you run a business around your career (an agent, an accountant, Equity membership, a casting directory listing, training, insurance) and how much control you have over your artistic interpretation. A single engagement can still be employment if those features are missing, so it is normal to have some work taxed through PAYE and the rest declared through Self Assessment in the same year.
National Insurance changed in 2014. Before 6 April 2014, special rules treated many entertainers as employed for Class 1 National Insurance even when they were self-employed for Income Tax. Those rules were removed, so fees from self-employed engagements, including repeat fees and royalties paid under them, are now paid gross and declared on your tax return.
Two practical consequences follow. First, your agent usually collects your fee and passes it on after commission, so record the gross fee as income and the commission as an expense rather than only the net amount that reaches your bank. Second, nobody is deducting tax for you on most of your work, so you need to put money aside for the bill.
Sole trader or limited company
Most actors work as sole traders. You register for Self Assessment by 5 October after the end of the tax year in which you started, keep records of fees and costs, and pay Income Tax and Class 4 National Insurance on your profit. If your total self-employed income is £1,000 or less in a tax year, the trading allowance means you may not need to tell HMRC, but you cannot claim expenses as well as the allowance.
Worked example: a self-employed actor in 2026/27
Sam lives in England and earns £40,000 in fees from self-employed engagements. Her agent takes 15% (£6,000). She also spends £2,000 on training, casting directory fees, headshots and self-tape kit. She has no other income.
| Step | Working | Amount |
|---|---|---|
| Fees | £40,000.00 | |
| Less agent commission | 15% of £40,000 | £6,000.00 |
| Less other allowable expenses | £2,000.00 | |
| Taxable profit | £40,000 minus £6,000 minus £2,000 | £32,000.00 |
| Income Tax | (£32,000 minus £12,570) x 20% = £19,430 x 20% | £3,886.00 |
| Class 4 National Insurance | £19,430 x 6% | £1,165.80 |
| Total tax and National Insurance | £3,886.00 plus £1,165.80 | £5,051.80 |
Sam's profit is above the £7,105 small profits threshold, so she is treated as having paid Class 2 National Insurance for her State Pension record without paying anything extra. Scotland has different Income Tax bands, so the figures differ if you live there.
Agent fees on PAYE work
Employees normally cannot deduct their own costs, but actors, singers, musicians, dancers and other theatrical performers are an exception for agent fees. Section 352 of ITEPA 2003 allows a deduction for agent fees paid out of employment income, capped at 17.5% of the earnings from that employment, including any VAT on the fee. If a TV role pays £10,000 through PAYE and your agent charges 12.5% plus VAT (£1,500), the cap is £1,750, so the full £1,500 is deductible. For a basic rate taxpayer that saves £300 of Income Tax, claimed through your tax return.
When a limited company comes up
Some established actors contract through their own company. The company pays Corporation Tax at 19% on profits up to £50,000 and 25% above £250,000, with marginal relief in between, and you take money out as salary and dividends. From 6 April 2026, dividends above the £500 allowance are taxed at 10.75%, 35.75% or 39.35%. If a production would have employed you directly, the off-payroll working rules (IR35) can apply, and for most medium and large clients the client decides your status. Run the numbers with our sole trader vs limited company calculator before you incorporate.
Allowable expenses for actors
An expense is allowable when it is wholly and exclusively for your acting business. The list below covers the costs actors ask about most.
| Cost | Allowable? | Notes |
|---|---|---|
| Agent commission on self-employed work | Yes | An ordinary business expense. The 17.5% cap only applies to PAYE work. |
| Costumes bought for a role | Yes | HMRC accepts clothing bought for a film, stage or TV role as costume. |
| Everyday clothes for auditions or meetings | No | Ordinary clothing is disallowed even if you only wear it for work. |
| Equity and other professional memberships | Yes | Where the membership relates to your work. |
| Casting directories, headshots, showreels, website | Yes | Marketing costs for winning work. |
| Classes and coaching | Usually | Allowable when they maintain or improve skills you already use, not when they start a new line of business. |
| Self-tape camera, lighting and microphone | Yes | An expense under the cash basis, or capital allowances under traditional accounting. Reduce the claim for any personal use. |
| Travel and hotels for work away from home | Yes | Not ordinary travel between home and a regular place of work, and not costs the production pays. |
| Phone and broadband | Business share | Work out the business proportion of the bills. |
| Working from home | Yes | Flat rate of £10, £18 or £26 a month depending on hours, or a reasonable share of actual costs. |
| Gym, medical and cosmetic treatment | Generally no | HMRC treats these as having a private purpose except in rare cases. |
If you drive to work away from home, the simplified mileage rate for 2026/27 is 55p a mile for the first 10,000 business miles and 25p after that, instead of actual running costs.
VAT for actors
You must register for VAT if your taxable turnover goes over £90,000 in any rolling 12 months, or if you expect it to go over £90,000 in the next 30 days alone. Only your business income counts; PAYE wages do not. Work for a production company based outside the UK is generally outside the scope of UK VAT under the business to business rule, and out of scope income does not count towards the threshold, but your accountant should check each contract.
The Flat Rate Scheme rate for entertainment is 12.5%, but actors buy few goods, so many would be limited cost businesses paying 16.5%. That usually makes the standard scheme the better choice. Our VAT registration guide covers the process.
Other issues actors run into
- Payments on account. Once your Self Assessment bill is £1,000 or more, and less than 80% of your tax is collected at source, HMRC asks for two advance payments towards next year, each half of this year's bill. A good year can therefore create a large January payment.
- Work abroad. If tax is deducted overseas, you still declare the income in the UK and can usually claim Foreign Tax Credit Relief. How much depends on the double taxation agreement with that country.
- Making Tax Digital for Income Tax. If your self-employment and property income before expenses was over £50,000 in 2024/25, you have needed MTD compatible software and quarterly updates since 6 April 2026. The threshold falls to £30,000 from April 2027 and £20,000 from April 2028. PAYE wages do not count. See our guide to MTD for Income Tax.
Key deadlines for 2026/27
| Date | What is due |
|---|---|
| 7 August 2026, 7 November 2026, 7 February 2027, 7 May 2027 | MTD quarterly updates, if you are in MTD |
| 5 October 2026 | Register for Self Assessment if you started acting work in 2025/26 |
| 31 January 2027 | File your 2025/26 return online and pay the balance plus your first payment on account for 2026/27 |
| 31 July 2027 | Second payment on account for 2026/27 |
| 31 January 2028 | File and pay for 2026/27 |
How GoForma helps actors
GoForma is an online accountancy practice working with clients across the UK by phone, video, email and WhatsApp. Our accountants are ACCA and AAT qualified, and FreeAgent accounting software is included in every package so you can record fees, commission and receipts as they happen.
- Start Sole Trader, £44 a month plus VAT with 50% off for the first 3 months: your Self Assessment return, a dedicated accountant and WhatsApp support.
- Start Sole Trader + MTD, £68 a month plus VAT, if you are in Making Tax Digital.
- Start Bundle, £88 a month plus VAT, if you work through a limited company, including an IR35 review on every contract.
- A one-off Self Assessment tax return for £198 plus VAT.
See all packages, read more about our accountants for creatives, or book a free consultation to talk through your engagements.