Cost of Doing Business Calculator
It’s important for every self-employed photographer to know what it costs them just to “turn on the lights”. Before the first customer comes calling, a photographer can spend tens of thousands of dollars to equip themselves. They then have to continue to spend on new equipment, office supplies and many other business expenses as their business grows. All of these expenses, called “business overhead”, have to be earned back or else the photographer will lose money.
Business overhead includes all costs, except wages or salaries, necessary to operate your business. It does not include any expenses that are billed directly to the customer.
A photographer’s “cost of doing business” is their business overhead plus their salary and divided by their number of “billable days”. A billable day is the time during which the photographer is actively working for a paying customer.
But it’s very important to note that we’re trying to calculate your annual business overhead, not your annual income tax. The two are quite different. For examples: advertising your business in a foreign publication is a business expense but it’s not tax deductible; the real cost of your cameras is often higher than the allowable depreciation rate; your home office is a business expense but may not be tax deductible if it’s a dual purpose room; business meals cost more than the allowable 50% rate for tax purposes; going to conferences, conventions and seminars is a valid business expense but only two per year can be tax deducted.
This calculator is for general informational use only and should not be used for income tax or accounting purposes.
You may need a pencil, paper and calculator to properly figure out some amounts. When in doubt, it’s better to err on the high side. Enter only annual amounts and do not include taxes. Any expense field left empty will be assumed to be $0.
Click on each item’s name for more information.