How to manage your money as a sex worker or escort March 9, 2020 – Posted in: Adult Industry News, Brothels, Escorts – Tags: brothels, escorts, finances, manage your money, sex worker
Working as a sex worker can mean that you are surrounded by cash. This makes living in a world where we no longer pay for a lot of things in cash, (think uber eats) a little difficult. How do we track our earnings and save accordingly for our future? This article focuses on ways to manage your money when working in the adult services industry?
Step 1: Sort out your old finances!
When was the last time you lodged a tax return? Do you have multiple tax returns outstanding that you think of every few months and put on the end of your to do list. The first step in setting yourself up for financial freedom is to get on top of your past. The Australian Tax Department can fine you if you are late lodging your tax – this fine is $1050.
What do you have to pay tax on?
As an escort or sex worker, you are required by law to pay tax on the following: ordinary earnings from working (cash, credit card, bank deposit, direct deposit, Paypal or BEEM IT), commissions paid by clubs or agents, tips from customers including those paid in tipping dollars, appearance and performance fees, royalties, prize money won from competitions and fees charged for lessons or choreography. Why do we pay tax? If you are a sole trader you need to be set up with PAYG – essentially this saves you having a huge tax bill at the end of the financial year. Instead you pay tax every 3 months in smaller instalments. The amount is based on your previous tax return. Empire Industry Finance can help you with this!
What can sex workers claim for tax?
Claimables make your total income lower so you pay less tax. Claimable items as a sex worker can include, costumes, shoes, specific makeup, travel costs for touring, car expenses, % of your rent, % of your phone and uber/taxi costs to and from work. Keeping cash receipts for tax time can help lower your tax bill. We suggest keeping an electronic version of these receipts in a folder on your phone. At Empire we set you up with your own dropbox where you can store receipts and where we store any correspondence from the ATO. Legally you or your accountant are required to keep these records for 5 years.
Step two: Business or personal?
Work out your cost of living and separate your business and personal finances
This is made simple when you have a separate bank account for your business. This can also simplify things at tax time for you or your accountant. Working out your cost of living each month + adding what you want to save each month = how much you have to make this month! Working out this number can motivate you to hit your target! What gets measured, gets improved. So start tracking and calculating!
Save for a rainy day!
In my experience, the rainy day could be a day where self-care is needed or a day you are unwell. Working as a sex worker means having no annual or sick leave which can be stressful. This can also push yourself to work when you are not 100%. But there are ways to help with this stress through careful planning. How much money do you need each month for rent, groceries and any other necessities? Can you put away $20 or $50 dollars a week or month for emergencies? Having a plan for your money helps give you financial freedom.
Credit: This article was supplied and published with permission from Empire Industry Fiance.
Empire is touring in 2020!
We are coming to most states in Australia and holding free workshops to talk about tax, loans, superannuation & setting yourself up for financial freedom. Details can be found on our website www.empireindustryfinance.com.au or on our Instagram @empire_industry. We also offer complimentary phone consults to discuss our services – email or DM Empire to find out more.