Contract/royalties


Findingmyway

New Member
Hi there,
I am new here.
I have been introduced to someone who likes my illustration and would like me to put together a draft for them. They have the story written and the styles they want already set. I have two enquiries-

1-She asked me what the prices would be? I have no idea what to answer and I told them I would get back to them. How do you guys decide what the prices would be?

2- do you have a contract? What guidelines are you using? What are you including in the contract? Do you issue the contact to the claimant?
Do you have to go through Hmrc before any contract or pay is given?

Thank you everyone. :)
 

bigdave

Moderator
Staff member
Ok so a contract is between you and your customer.. It isn't a legal requirement but it's there to protect you (and the customer) in case something goes wrong (eg; the client doesn't pay, becomes unnecessarily difficult, moves the goal posts etc..). essentially a contract is a set of 'rules' that you both agree to work under and has nothing to do with hmrc.

Payment is again, between yourself and the customer. In a contract it's not unusual to find details of payment terms such as how long a client has to pay and "milestones" (eg; 50% upfront, 20% on approval of designs, 30% on completion and file release. The actual figure is for you to decide). To request payment for a milestone you'd need to submit an invoice to the customer stating how much you require, what it's for, the date the invoice was made out and your banking details.

As you have have no knowledge of invoicing, HMRC etc.. I'm guessing you're not registered as self employed? By the letter of the law, if you're taking payment for work the government will expect their cut in the form of income tax.... However, if this is likely to be a one off job and not a regular source of income you need to weigh up if it's worth the hassle of registering with HMRC, keeping books, calculating tax etc.. for a single payment which is highly unlikely to ever flag up anywhere.


**note**
I'm not a lawyer, if you get in s**t for not registering it's not my fault.
 

Wardy

Well-Known Member
It really depends on whether or not you intend to make a living from this, like Bigdave says, but either way you only need to tel hmrc at the end of the tax year when you've done a few jobs.

Pricing is up to you and usually depends on your experience. Choose an hourly rate that fits your experience and multiply that by the amount of hours spent doing the work. You can always do a sample for them
first to see how long they're going to take.

Contracts are up to you and them. I don't usually bother, just to keep things simple, as a lot of my work is done for private individuals. I just make sure I get a deposit first and ensure I get the balance
once they're happy with the digital copies and prior to me sending them the final files.
 

Findingmyway

New Member
Hi Guys,

Thanks a lot for the replies, very informative. For now it is probably going to be just a one off. I don't see myself doing anything other than this, so i'll leave the HMRC put of it for now.

Thanks again
 

Paul Murray

Moderator
Staff member
I don't see myself doing anything other than this, so i'll leave the HMRC put of it for now.
Unfortunately it doesn't really work like that. You need to declare all your income, otherwise you're essentially avoiding paying tax. Even for a one-job you're legally obliged to declare your earnings and should register as self employed (it's free and pretty quick). If you want to not bother that's up to you, but tax avoidance is not taken too lightly in the eyes of the law (unless you're a huge company not paying millions, of course :whistle: ).
 
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