Tax Guide for Writers and Authors: Royalties and Expenses

The Accounted Business Team·11 February 2026·7 min read

Writing for a living comes with some unique tax situations. Royalty income arrives in unpredictable lumps, expenses are often modest but varied, and there are specific HMRC rules that can work in your favour if you know about them. This guide covers everything self-employed writers and authors need to know for the 2025/26 tax year.

Registering as Self-Employed

If your total self-employed writing income exceeds £1,000 in the tax year (6 April 2025 to 5 April 2026), you must register as self-employed with HMRC. This applies whether you earn from books, articles, copywriting, ghostwriting, scriptwriting, or any other written work.

Register by 5 October following the end of the tax year you started. If you have been writing for years and only just crossed the £1,000 threshold, register now.

If your writing income is £1,000 or less, the trading allowance means you do not need to register or report it.

Types of Writing Income

HMRC treats writing income as self-employed trading income. This includes:

Royalties from traditionally published books
Advances from publishers (taxable when received)
Self-publishing income from Amazon KDP, IngramSpark, or other platforms
Freelance writing fees for articles, copywriting, or content
Ghostwriting fees
Scriptwriting income for film, TV, radio, or theatre
Public Lending Right (PLR) payments
Translation fees or foreign edition royalties
Speaking and event fees related to your writing career
Teaching and workshop fees (creative writing courses)

All of these go into the same self-employment section of your tax return.

Averaging of Royalty Income

This is the single most valuable tax rule for authors, and many writers do not know it exists.

How averaging works

If your writing profits fluctuate significantly from year to year, you can apply to average your profits over two consecutive tax years. This reduces the impact of having one very good year and one poor year, which can push you into a higher tax bracket unnecessarily.

You can claim averaging if the lower year's profit is less than 75% of the higher year's profit. HMRC then adjusts both years so you are taxed on the average of the two.

Example

Year 1 profit: £10,000
Year 2 profit: £45,000

Without averaging, you pay basic-rate tax on both (assuming no other income). But the jump might tip you into higher-rate territory if you have other income.

With averaging, both years are treated as if your profit was £27,500. This can save significant tax if one year pushes you past a tax band threshold.

How to claim

You must claim on your Self Assessment tax return for the second of the two years. You have twelve months from the filing deadline to make the claim. Averaging is available specifically to authors, artists, and other creative professionals whose income naturally fluctuates.

What Expenses Can Writers Claim?

Home office

Most writers work from home. You can claim:

Flat rate method:

25 to 50 hours per month: £10 per month
51 to 100 hours: £18 per month
101 hours or more: £26 per month

Actual costs method:

Calculate the proportion of your home used for writing. If your study is one of five rooms and used for business 70% of the time, claim that fraction of rent or mortgage interest, council tax, utilities, broadband, and home insurance.

For full-time writers spending 40+ hours a week in a dedicated study, the actual costs method typically gives a better result.

Research expenses

Research is a genuine and sometimes substantial cost for writers. Deductible research expenses include:

Books and publications bought for research
Archive access fees
Travel for research purposes (visiting locations, interviewing subjects)
Accommodation and subsistence while on research trips
Subscriptions to databases, journals, or reference services

Important: The research must be directly connected to a writing project. A holiday to the Amalfi Coast is not deductible just because you are setting your next novel there, but a focused research trip with planned activities, interviews, or location scouting can be.

Keep detailed notes linking your research expenses to specific projects. HMRC may question vague claims.

Agent fees

If you have a literary agent, their commission (typically 15% of UK earnings and 20% of foreign earnings) is a deductible expense.

Record it carefully: your gross income is the full amount before the agent's cut. The agent's commission is then a separate expense. Your agent should provide an annual statement showing total earnings and commission deducted.

Travel

Travel for writing-related purposes is deductible:

Meetings with your publisher, agent, or editor
Literary festivals and events where you are appearing
Research trips (as above)
Travel to teaching or speaking engagements

Claim at 45p per mile for the first 10,000 business miles and 25p after that, or use public transport fares. Keep receipts and a mileage log.

Technology

Computer or laptop
Printer and ink
Writing software (Scrivener, Microsoft Word)
Cloud backup and storage
Website hosting and domain for your author site

Self-publishing costs

If you self-publish, the costs of producing your books are deductible: cover design, editing (developmental, copy-editing, proofreading), typesetting, ISBN purchase, proof copies, marketing (Amazon ads, BookBub, social media), and distribution fees. These can add up to several thousand pounds per book.

Professional memberships and training

Fees for bodies like the Society of Authors, Writers' Guild of Great Britain, or the National Union of Journalists are deductible. So are creative writing courses, editing workshops, and business skills training related to your writing career.

Public Lending Right (PLR) Payments

PLR payments compensate authors when their books are borrowed from public libraries. The maximum payment per author is £6,600 per year (for the 2025/26 period). PLR payments are taxable self-employed income and should be included in your tax return.

PLR sends you a statement each year showing your payment. Register for PLR if you have not already — it is free money for work you have already done.

Advances and Royalty Timing

Cash basis vs accruals

Most sole traders use the cash basis, which means you report income when you receive it, not when you earn it. Under the cash basis:

An advance received in January 2026 is taxable in 2025/26, even if the book is not published until 2027
Royalties received in July 2025 are taxable in 2025/26, even if they relate to sales from the previous year

This is simpler but can create lumpy income in certain years, which is where the averaging provision becomes valuable.

Unearned advances

If you receive an advance that you later have to repay (because the book is cancelled or you fail to deliver), the repayment can be deducted in the year you make it.

Working Out Your Tax

Add up all writing income received in the tax year
Subtract allowable expenses
The result is your taxable profit (before any averaging claim)

Apply the £12,570 Personal Allowance, then:

20% on profits from £12,571 to £50,270
40% from £50,271 to £125,140
45% above £125,140

National Insurance:

Class 2: £3.45 per week (if profits exceed £12,570)
Class 4: 6% on profits between £12,570 and £50,270, then 2% above

Common Mistakes Writers Make

Not knowing about averaging. This can save you hundreds or thousands of pounds. Check every year whether you qualify.
Not claiming research expenses. If you travel for research, buy reference books, or access archives, claim it.
Forgetting PLR. Register and claim it — it is income you are entitled to.
Missing agent fees as a deduction. Your agent takes their cut, but make sure you are deducting it properly.
Poor record keeping. With income from multiple publishers, platforms, and sources, it is easy to miss payments or duplicate them. Download statements from every platform annually.

Record Keeping

Keep records for at least five years after the filing deadline:

Publisher and agent statements
Self-publishing platform reports (KDP, IngramSpark)
PLR statements
All expense receipts
Bank statements
Contracts showing advance and royalty terms

Accounted simplifies this for writers. Penny, the AI bookkeeper, can track royalty payments from multiple sources, categorise your research and publishing expenses, and keep everything organised so you are not scrambling in January. It is particularly useful if you have income from several publishers and platforms that all pay on different schedules.

Start Your Free Trial With Accounted

Writing is hard enough without the tax headaches. Accounted gives authors and writers a simple, affordable way to keep on top of their finances. Start your free trial today and spend your time writing, not bookkeeping.

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