Show me the money!

So, you have secured some paid music leading; congratulations! But how do you make sure that you get paid for the work that you do in a timely fashion? This advice and guidance blog will take you through everything you need know about contracts, invoicing and ulitmately, getting paid for what you love to do!

Contracts
Firstly, you need to make sure that you have a contract in place. The contract should outline at the minimum:

• What you will be doing
• When you will be doing it
• Where the work will take place
• What the fee is
• Terms of payment (also known as when can you expect payment).
• What happens if the work is cancelled

It is usual for the employer or contractor to issue a standardised contract when they book you for work; however the employee (i.e. you) can also issue a contract or booking agreement once you have been approached. Most employers will send you two copies of the contract they have prepared and signed, and ask you to sign and return one copy to them and keep the other for your records. By having a written agreement in place, you are in a much better position to contest non-payment should any issues arise at a later stage.

When to invoice
Unless you are employed and working for an organisation, you will usually need to send an invoice to your contractor in order to release payment. If you are unsure about whether you should be classed as employed or self employed, please visit the DirectGov web pages for more advice.
The time for invoicing will depend on the type of work you are delivering for the employer. For example: a music leader delivering a one off workshop would invoice in full on or after the workshop date, whereas a music leader delivering a large scale project over a number of weeks in a school might be asked to invoice on a monthly or even termly basis.

Just like when your credit card company sends you a bill in advance of the date they require payment, your invoice is a notice that you require payment by a future date. For example, if the terms in the contract are 30 days (which is the standard) and you send an invoice on Wednesday 1st September 2010, it could be Friday 1st October before the payment is released to you – remember this is 30 days from the date on your invoice, not from the date of the workshop itself! You also need to remember that if a payment is sent to you via BACS or cheque it could take a further few days for your fee to show in your bank account.

How to write an invoice
We know an invoice can take a while to be paid, so in order to avoid any further delays, it is important that you include as much information on your invoice as possible.
Remember, it is quite likely that the person who processes the invoices isn’t the same person who contracted you in the first place, so they won’t automatically know what your invoice is for.
An invoice needs to have:

• An issue date
• Your name, address and contact details
• Any purchase order number from the employer – large organisations such as local authorities will have hundreds of invoices outstanding on an automated system
• Dates of the work you delivered
• Description of the work i.e. Samba drumming workshops at St Paul’s Community Centre
• Hourly Rate (if applicable)
• Total Fee including any travel and or expenses that have been agreed in the contract
• Self Employment Tax Reference Number – when working as a freelancer, you are responsible for your own tax and national insurance and therefore need to register with the HMRC as self employed
• VAT reference number is you have one – you will need to register for VAT if your turnover as a music leader is over £70,000 (I should be so lucky!)
• Bank details if you wish to be paid by BACS
• Payment terms i.e. to be paid by BACS or cheque within 30 days

The HMRC is currently applying pressure to employers regarding the way in which they contract freelance staff. Be aware that you might be required to complete forms and provide proof of your status as a sole trader / partnership / company before you are contracted.

Top tips for getting paid on time

• Be organised about your invoicing – by taking the time to set up a spreadsheet with details about all your invoicing will help you keep on top of the process and make like easy when you come to do your tax return.  For example:

 
For those of you who are computer savvy, you could even set up a mail merge to automatically produce your invoices from the spreadsheet or set reminders for overdue payments via outlook.

• Make sure you send your invoices in on a regular basis – why not set aside an afternoon per month to go through your spreadsheet and issue invoices and chase any overdue payments
• Make sure you include any purchase order numbers provided by the employer on your invoice – larger companies who work with automated systems such as SAP will reject your invoice if it doesn’t have a purchase order number
• Make sure your address and bank details are correct
• Make sure you invoice before the end of the financial year – many organisations become frantic in March and April trying to get their final accounts completed.

If you need a beginners guide to working as a music leader why not attend one of our Start Up sessions? These take place in venues across the country on a regular basis. Check out our training directory for upcoming events or contact your Regional Network for more information about Start Up or anything contained within this article.

Useful Links
The Musicians Union has been established to protect working musicians and offers additional benefits to members such as public liability insurance.
www.musiciansunion.org.uk

Directgov provides information on self assessment tax, VAT and self employment
www.direct.gov.uk

Business Link provides information and support to small and medium sized businesses including how to set up as a business
www.businesslink.gov.uk

Rea Lawrenson, MusicLeader Yorkshire Manager