Champions of the gig economy
John Butler is one of Australia’s most successful independent artists. He co-founded his own record label and his blues roots group, the John Butler Trio, has released numerous award-winning albums and earned millions of fans worldwide.
When US-born Butler sees his accountant, he doesn’t take a plush lift to the upper floors of a modern city high-rise. He makes his way to a northern Perth beachside suburb and finds the work entrance of Kylie Thompson’s home – the headquarters of Sorrento Strategic Accounting.
Butler was one of Thompson's first clients; he has been with her since he was busking in Fremantle. Twenty years on, Thompson is a financial specialist in the creative arts industry; about half of her clients are prominent or emerging musicians, actors, designers, dancers and artists. Almost all of them live in Perth, and many are independent contractors or part-time workers engaged in the shared or "gig" economy.
Using information drawn from the Household Income and Labour Dynamics in Australia survey, Bankwest Curtin Economics Centre researchers estimate 11.6 per cent of the Australian workforce are independent contractors. This is equivalent to about 1.27 million workers.
Researchers say many of these independent contractors work in the artistic space. About 27 per cent of online freelance services are in the creative and multimedia fields, reflecting the demand for video, social media, design and animation. What they can’t easily quantify, however, are how many musicians, artists and actors – or those who drive share cars in the evening – struggle to find constant and stable work, and often live hand-to-mouth.
This is where Thompson – as a trusted CPA, financial planner and self-managed super fund specialist – feels she can play a role.
“Everyone's good at something,” she says. “If you're good at numbers, take that headache away from people so they can go out and make music and write songs. It's not been hard work for me to develop this niche market because I'm passionate about it and I can see I make a difference.”
Accountants need to ensure self-employed clients are aware of their tax and legal obligations as contractors, and understand what component of their income is taxable. Often the companies employing them aren't fully aware of these requirements either.
Accountants have to design easy ways for clients to track their income and expenses at tax time. Thompson has created a spreadsheet for her clients to fill in ahead of any meeting with her to make this process as simple as possible.
Perhaps most importantly, accountants need to educate themselves in the financial rules and regulations governing their clients' industries and try to better understand the challenges they face. Over the past five years, Thompson has deepened ties with the local creative arts scene, sponsoring music awards and local community radio station RTRFM. For the past four years, she has presented free tax workshops for WA Music and music rights organisation APRA AMCOS.
Not only has this helped her stay close to industry players and further earn their respect, she has doubled her client base. After 40 people attended one of her tax seminars in June, 35 became Sorrento Strategic Accounting clients.
Thompson admits that the sudden growth has its challenges. Her priority is always to maintain a personal touch, something she knows is essential for local clients. "If people want to see Kylie, I want them to come and see Kylie," she says. "That's how I've sold my practice: what you see is what you get."
Another way Thompson keeps up standards and her professional knowledge is through her involvement in a CPA Australia discussion group called Accountants in Suburbia (AIS).
Every month for the past 35 years, CPAs working in and around Perth have met in the offices of a city legal firm. Entry to the meetings on Adelaide Terrace is strictly invitation only. It currently has 22 members, and at least 15 engage every month.
Thompson, an AIS member for 15 years, is the chair. She says AIS began as a way for accountants to support or fill-in for each other when they went on leave. Now she appreciates the chance to catch up with like-minded professionals to discuss issues, listen to guest speakers, share knowledge and recommend potential clients to each other.
“It's just brilliant when you're working on your own, because you've got to keep up to date,” Thompson says. “The networking side of being a CPA in that group is just priceless. It was the kind of extra support I needed after starting my business.”
Does she have any advice for accountants wanting to work with clients in niche industries?
“I just think you've got to find the area you're interested in,” she says. “When you've got happy clients walking out going, ‘That's such a load off my mind’, that's fantastic. You know you're helping them do what they do better. It's pretty easy.”
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