Business cards are not the only thing you need to worry about when setting up in business a a DJ. Here we look at some of the other bases you ought to make sure you've got covered.
Reader DJ Bobby Bob writes: “I am very interested in the hobby of digital DJing. Have studied a variety of different websites (this being one of my regular favourites) it’s become clear this field of work is more expansive than I thought.
“Now that I am past the basics of performance, I am starting to realise I might like to try and make a professional career for myself in DJing. But as I’ve got better at the skills, I’ve become more confused about the industry! What are the laws that a DJ needs to know about in order to step into the business side of the entertainment industry?
Digital DJ Tips says:
It’s like any small business – you need to keep track of income and expenditure and declare your earnings at the end of the year to the relevant authorities.
How you set up your business – “sole trader”, partnership, limited liability company etc – is up to you, and will depend upon the earnings potential you feel it has for you, whether you’re doing it alone or with someone else, whether you will be doing it full/part time, and of course the options open to you depending upon where you live.
The tax authorities can be relentless if they pursue you, for whatever reason…
There may be licensing requirements (public performance of music) depending which country you’re in, although if you play in licensed venues this is usually taken care of for you (thus it becomes an issue when you’re a paid mobile DJ playing in places that don’t have music normally).
When you’re very small, the law is usually a bit laxer than when you start to make a bit more money, but it’s worth working all of this out at the beginning rather than waiting – it needn’t take too much effort.
Use an accountant
Ask an accountant or even a bookkeeper for initial advice on this – you ought to get this advice for free, especially if you show an interest in hiring the person concerned once you’re all up and running.
Unless you really are a tiny concern, it is well worth paying for an accountant anyway – a good one can save you money and act as a buffer between you and the tax authorities, who can be relentless if they pursue you for whatever reason.
Treat it like a business
Once you’re responsible for an income, declaring money, making ends meet etc, it becomes like any business – and you may feel you’re getting away from the “music” side of it that drew you to it in the first place. If you love EDM but are only make money from weddings, then business tells you to chase wedding bookings – but your “music” head may say you don’t want to do that, for instance.
Many DJs like to keep it as a hobby, or go “semi-pro” – where they make extra pocket money but keep a day job.
If you love DJing and will happily play for hours for free at a cool party, but need to make another $500 this month to make ends meet, you may end up playing a load of badly attended bar gigs to cover your costs instead – and missing out on your party!
That’s why many DJs like to keep it as a hobby, or go “semi-pro” – where they make extra pocket money but keep a day job. Just remember, though, the taxman doesn’t care if it’s a hobby or not – if you’re getting paid, he wants to know.
What procedures did you follow when you set up in business as a DJ? Have you run foul of the authorities because you failed to keep books or have the right licences? Please let us know your experiences and advice in the comments!
Now go to:
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Tags: business of djing, career in djing, djing business, djing industry, music industry
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I agree with Phil’s points. I think when you’re doing it as a hobby/once-in-a-while thing and get a client who ends up paying you in cash, then in some cases you can dodge the tax man and get away with it.
However, in many bars and club now, you’ll end up on the payroll with paychecks coming in and taxes taken out. Seen some guys make a stink and want to be paid cash, but the owners simply said they’re not risking their business licenses on it.
I also agree with setting up a business account and getting a business tax code especially if you’re running as a mobile company. Part of the reason is you can write off a lot on your taxes as business expenses. Things like:
– Gas spent on getting you to the event
– New equipment you buy
– Web hosting you pay to advertise
– Expense on business cards, CDs, promotional materials
– Music…yes, it’s part of your business
Save receipts and if you’re not an accountant, get one. They know loads of ways to pay less taxes. Why do you think big corporations pay them?
The other reason to get a business tax code is liability. That means if some client has some legit way to sue you and win, he/she can only get what’s in your business. So he/she might get the money from the sale of your gear and the car you wrote off as a business expense, but he can’t come after your personal home or personal life.
I think the main types of DJs who really need to worry about all of this are the guys who work regularly. If you’re playing in bars/clubs and getting handed checks, or if you’re a mobile and are playing at least once a month at weddings and such.
It’s like when you make mixes and post them on the net. No one is going to notice until you’re taking in money in noticeable amounts.
[ link ]The owner at one of my gigs told me she writes me off for taxes or something like that. Yet, she pays me cash. Go figure.
[ link ]Just make sure there’s no paper trail…
[ link ]Thank you very much for the information. I will definitely have a meeting with an accountant and discuss all of this ideas. Looking forward to seeing that mix from ya Phil
[ link ]A lot depends on what you want to achieve and whet the tax legislation is in your country.
DJ’ing is a hobby for me and I want to keep it that way. But since working in “black” isn’t an option when doing weddings, business events and playing venues. I got myself a “small business” statute. I can make invoices and be legally in order with all legislations, cannot deduct taxes but haven’t got the hussle of the full bookkeeping … reduced bookkeeping is enough and I can (and I am allowed because of my master studies) do it myself.
So before jumping into dj’ing as a full time profession, start as a business on the side. As soon as that is picking up you can start shifting away from your regular job.
Treating dj’ing as a business, making the correct investments, finding a balance in buying what you need, what you want and what is profitable, is something you have to learn and comes “over the years”. Are you going to cut with just dj’in or are you also going to provide moodlighting, sound/light rental services, …
[ link ]Good advice, Bart. I have been in “business” for 15 years, and even now I hate the “business” side of things (I’m putting off doing the accounts today as I type this!). Running a business is a big commitment and it has stresses and responsibilities that are often at odd with the enjoyment you think you’re going to get out of it.
[ link ]I’d say talking to that accountant is real key at the start of things. It only takes a small slip to have the taxman come after you, and they are not likely to be sympathetic, especially if you write off any of your expenses. Hell, I DJ’ed one place and they cut the checks to my stage name… and the IRS still somehow found out about them and had me pay back taxes on them!
[ link ]VERY INFORMATIVE. GOOD JOB.
[ link ]Go talk to a lawyer about drafting you a bomb proof contract. Nothing says professional more than a professional comprehensive services contract. In that contract you can spell out exactly what you are going to do, who is responsible for what and on what schedule to be expecting deposit and full payment and how. Even if they are paying in goats. Get it in the contract.
To incorporate a business is to defer liability to a legal fiction. So if you… kill someone with bass??? they will sue the fiction and not you. It creates a wall of separation so to speak, of your personal stuff like kitchen table and roof overhead from the legal entity’s stuff like mixers and amplifiers and bank accounts and such. The down side is that you are telling the government what you are up to. And rarely have I found that they worked to actually perpetuate anyone’s business more than hinder, license, tax, and confiscate it.
If I didn’t say it before… The contract makes the law between you and the venue or people paying you. Getting a good one is money well spent.
[ link ]Solid advice, and well explained.
[ link ]Hi this is something I seriously need for my wedding DJ business, not only for the clients but also regular venues I play of which I am a supplier so to speak. The problem is i really dont know what everything is that needs to be covered in the contract, normal things like no responsibility if there is a power outage, and non refundable booking fee etc i understand,but what should i be looking at to include in the contract to make certain I am (and the client) are legally covered? any advice here would be highly appreciated.
[ link ]Well you want to stipulate how you are getting paid and your equipment protected first and foremost. Your homeowner’s insurance is a LAST line of equipment replacement money, not the only one.
Have in there “With the exception of the provided guest microphone(s) found on the wedding party table, NO one is allowed to handle, alter, adjust or move any piece of your equipment at any time.”
You can search on line for “wedding reception questionnaire” and “wedding reception dj contract”. To get an idea of how the two are sometimes separated or sometimes the same thing, and how other dj’s are using which for what, and how.
Djintelligence has a pretty comprehensive business software system, I’ve seen. Feedback, scheduling, booking and music search.
[ link ]And most important what people think wrong is: I will decide to become a… In this case to become a DJ (digital DJ) is not wrong but I saw a lot of people decided to go for DJ-ing but they don’t have a talent, which is also very important fact. To buy an equipment today is not such a problem.
[ link ]in the uk music guard and their various competitor offer cheap mician based insurance, this can include public liability,
we should all keep cables tidy and fly speakers properly but accidents can happen, so spend the £30 on a public liability policy to take the financial pressure off yourself.
Also, gigging will destroy equipement if you dont flight case it properly, look after your tools and they’ll look after you.
[ link ]Sound advice, thanks for the Music Guard tip.
[ link ]I love all your posts. They really help me. Please can you post something about Djing with controllers(Pad controllers)(example-native instruments machine). Difference with the others and pros and cons. Thank you
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