Not tech-specific, but this feels more at home here than in Gen Disc:

Since moving into a house, and coincident with the pandemic, I've thrown together kind of an adequate project studio. Separate "studio" and "control room," OK acoustic treatment, a true large-format console albeit a cheap one, decent monitoring and outboard/plugins. Nothing to get excited about, but I would guess it's one of the more full-fledged and unusual home recording spaces in my area. And as vaccines are rolled out, before long I'll be able to open it up to others.

I have no commercial aspiration for the space, no intention of running a proper business out of my basement. But I'd like to work on the occasional outside project, something I only started doing in 2019 before moving here and setting up the actual studio. I see myself recording maybe three "clients" a year, tops, and the rest of the time it's a private studio. So theoretically my work/this space could "bring in" maybe two thousand dollars a year? And I would be actively trying to cap it around that point, just in terms of weekends per year spent on third-party stuff.

So I don't conceive of this as a business, or even a part-time job. But I do conceive of it as a studio. A shitty studio, yet something I can name and make a website for, where I can neurodivergently make and post lists of all the equipment and instruments. All that good stuff.

Still, even though this studio is closer conceptually to me having a garden or an old Monte Carlo I'm fixing, the actual space and the stuff are starting to meet some of the criteria of a professional studio. And professionals have to think about reporting income and other things I have kind of a 10-year-old's understanding of. I don't want to be running afoul of any body or legislation if it turns out I'm rocking a Means of Production (which is kind of how I'm envisioning this—vs. me just reporting this as freelance work or something). And I know anecdotally there's the thing of "oh you can write off your gear/part of your house," and I'm not opposed to that if it makes sense for me. But as a third thing, I am extremely lazy and I don't really give a shit about any of that.

These are kind of the main things that are clanking together in my brain like rocks in a tumbler:

• I don't want to do some complicated or dishonest shit where for legal purposes my basement studio is a Catholic elementary school.
• I also don't want to have to be evasive and lie low and never leave a paper trail. Telling bands they can't post session photos to Instagram or something.
• Yet I also don't want to put the effort into getting the permits and registrations to start Running A Business that is not ever supposed to succeed.

I suppose I'm asking: which way of running a semi-private project studio will have the lowest risk of me ever getting yelled at? I know probably no one is going to notice or care about my setup in the first place, I just like to take precautions against getting yelled at.

I started doing drums for people last year and made enough that I have no choice but to report it as income. I also spend too much on gear which can reasonably written off as a directly related business expense (e.g. drums, cymbals, microphones, cables, etc...)

It was relatively easy to do all of this in the tax program I use (Turbotax), the biggest pain of it all was that the software charged me an extra 200 bucks or so based on adding the business income portion.

Striving toward the same idea, but way further behind in both experience and actually setting up the pile of gear I've amassed. "A Business that is not ever supposed to succeed" resonates with me, as I can't see it as a reliable or steady primary source of income ever. The thought of it being a "not for profit" scenario has been kicking around in my head for a while, but I haven't done much research on the subject. I know there's lots of rules about how such an entity can behave, but the basic concept seems reasonable. It's a venture with an artistic core mission and could certainly be justified as such, while still allowing for payment for services rendered, and if a profit happens it's like a nice surprise and goes back to the business instead of just lining your pockets.

I would say if you are taking money as a freelance worker in any way creating an LLC is not a bad idea. It's really cheap. Creates a minimal layer of protection for you. Also, if you are taking money from people for services rendered, always have at least a rudimentary contract. As someone that has freelanced for a long time, this is something I wish I had done from the beginning. All it has to do is outline the services that will be rendered and what you are to be paid for it. This is less about having a paper trail for payment, though that could be helpful, it really more about setting an expectation before any work has been done or money has changed hands. Heather and I have both learned this the hard way. Pay your taxes. All of them and on time. You can work out of your home and report it on your taxes and deduct workspace and costs from your taxes without declaring any official registration of a "Business" at your home address. Heather and I both work from home and my house is not registered in any way as a Business.

Is this a Canada thing? I mean, will anyone even notice the income? Can you get in trouble for using your residence as a home office?

I've recorded/mixed/mastered stuff for years and never reported anything that didn't come from a check that had the name of a recording studio on it. Same thing when I made and sold 3-6 pedals per month. I'm not trying to dodge anything, it was just that the hassle of including that income would have been a massive pain, but it was such a small percentage that I just didn't think anyone would care.

Of course, in my "unofficial years", this income was never more than about 5% of my income from my job with a paycheck.

benadrian wrote: Mon May 24, 2021 5:39 pm Is this a Canada thing? I mean, will anyone even notice the income? Can you get in trouble for using your residence as a home office?

I've recorded/mixed/mastered stuff for years and never reported anything that didn't come from a check that had the name of a recording studio on it. Same thing when I made and sold 3-6 pedals per month. I'm not trying to dodge anything, it was just that the hassle of including that income would have been a massive pain, but it was such a small percentage that I just didn't think anyone would care.

Of course, in my "unofficial years", this income was never more than about 5% of my income from my job with a paycheck.

I can't imagine it's noticeably different up here. And to reiterate no I'm not scared of getting busted by secret studio police exactly. I just have no frame of reference for how this stuff works, I'm not really tight with anyone IRL who runs a true home and/or commercial studio, or anyone who runs their own business really.

I guess I'm trying to find either a way to go "(semi-)official", or a reason to keep things unofficial. The lone outside project I've done ended up being picked up by a larger Canadian indie label before we'd tracked the last overdubs, and I unexpectedly found myself emailing/working with actual audio professionals for the finishing stages. So I've already had to do some quasi-professional work and coordinate with people who actually are professionals—maybe this is a good point to set up something up if I need to, before I've gone any further down the path? I would really just as rather not, of course.

Kniferide wrote: Mon May 24, 2021 2:26 pm I would say if you are taking money as a freelance worker in any way creating an LLC is not a bad idea. It's really cheap. [...] You can work out of your home and report it on your taxes and deduct workspace and costs from your taxes without declaring any official registration of a "Business" at your home address. Heather and I both work from home and my house is not registered in any way as a Business.

I like this! This is the kind of thing I was looking to learn. I think our setups/goals are pretty similar from what I can glimpse over the internet, so I might look into this further. Thank you!

Maybe this doesn't need saying, but get insurance.

Mason wrote: Sun May 23, 2021 1:14 pm I suppose I'm asking: which way of running a semi-private project studio will have the lowest risk of me ever getting yelled at? I know probably no one is going to notice or care about my setup in the first place, I just like to take precautions against getting yelled at.

I run a pro-level studio out of my home. I have insurance on my gear and anything that happens here, I pay taxes quarterly, I am a good neighbor. Been here since 2011 and have had zero issues. Live in the suburbs of Boston.

Do yourself the favor and setup an LLC or just sign up as a Sole Trader and get your taxes right from the start. If you ever get paid by someone or a label that gets audited well then that's a paper trail to you. I've got a couple horror stories of friends in the industry who had been skirting their taxes for a few years getting hit with five figure tax bills. If that happens the tax man will be on your back for the rest of your life.

I don't use an accountant anymore but when I did he was able to claim everything from food, petrol, clothes, tools, gear, repair works and I believe there was something about using my home as an office as well.

Does your basement have an egress or a door? Might be some technicalities with the fire code if not.

My biggest bit of advice is even if you only consider it a 'project' studio run it as professionally as you can. Keep it clean, tidy and and everything in working order. I've been in too many studios were the guy is a great engineer, nice gear but has no idea how to keep a session moving. Long pauses for patching gear in or googling how some bit of software works. Maybe run a couple practice sessions with friends before hand.

I ran my residential studio as a sole proprietorship; my business partner in the studio I'm in now ran his as an LLC since his mom is a CPA and gave him the savvy to do such things. However, I just looked it up and there's no national or provincial equivalent to an LLC in Canada, but there is for a sole proprietorship.

TL/DR: This is a question probably best left to a CPA, but everyone who says they use a CPA says they never regret it. Maybe that's your next step.