By Calyssa Erb (www.calyssa.ca)
So you’ve done the work of creating a grant application, sending it in, and… you received your first grant! Congratulations! You may not want to hear this while you’re in the middle of celebrating, but now is the best time to prepare yourself for tax season.
If you’re anything like I was when I received my first grant, you’re probably so excited about starting your grant-funded project that you haven’t even thought about tax season. If you’re also an artist transitioning from a simple T4 tax return, like I was, filing taxes for your emerging artist practice can seem daunting. But it doesn’t have to be!
From one artist to another, here are some tips that I’ve learned.
- Start a filing system. Whether you’re going to keep paper copies of everything or scan and store everything digitally, set yourself up for success by creating a system that works for you from day one. I like to keep everything in a digital folder, because it’s easier to search my computer than it is to search my apartment. If you want to go an extra step, you can even leave a note for future you to expect a T4A from the organization (OAC, Canada Council, etc) that awarded you the grant.
- Record important dates. Make sure you include the important dates for your grant in your filing system. You’ve likely already had to do this to apply for the grant, so save future you the trouble of hunting down that documentation. Keep track of when the grant starts, when it ends, and what you’ve planned to do with it along the way. This information will be crucial in determining how your income and expenses will be reported.
- Record and file all receipts/documentation. In your filing system, store all your receipts and documents like your T4A along with a running tally of how much of your grant you’ve used. For grants that cover more than one calendar year, this last part will be helpful in determining which income tax year to file each expense under.
- Know when to get support. You don’t have to do it all on your own. If you’re feeling overwhelmed, reach out to a professional. Places like Ross Professional Corporation and Artbooks specialize in providing accounting services to artists and freelancers. Just make sure you reach out early!
- Review your process. After tax season is over, write down anything that was particularly stressful or challenging for you. Make a plan for reducing those hurdles next year. Also, if you used a professional accounting service, note any questions or documentation requests that they asked for, so that you can be ready for next year.
ABOUT CALYSSA ERB
I am a queer, autistic Canadian writer. My writing has been shortlisted for CANSCAIP’s Writing for Children Competition. My poetry has been published in Aze Journal, a publication for asexual, aromatic, and agender writers and artists. Passionate about the power of books for kids and teens, I work in children’s publishing and am a member of The Festival of Literary Diversity’s Program Advisory Team.
Photo credit: Ashe Mocaw