Finding a tax agent or accounting person is a good idea.  The Prostitutes Collective are funded by the health department (which is how condoms and other supplies are so well subsidised), so advice they can give about finances could be limited, but they may be able to make recommendations for businesses who can help with financials.  Or you could do what I did and ring around, with one of the first questions being “I’m a sex worker and I need someone to help me with my tax obligations etc – is my occupation something you have a problem with?”  You’ll be surprised how many people say they don’t want to help you – apparently there are a lot of professional accountants who don’t want to touch sex workers with a 10 foot barge pole.

However, you should also watch out for timewasters where you are paying for inefficiencies, (or long discussions about sex work).  Also, do you really need the boss and the staff member who is taking care of you sitting in together with you at rapt attention at some of your expenses?  You would be paying for both of their time, although I have to say, money spent on someone who knows this area well is money well spent.  Also, bear in mind, that you can make an appointment with the IRD and take along your bookkeeping or whatever you have and get free advice from or check things over with them – you’ll probably have to call them to clarify which expenses are able to be claimed as tax deductible expenses, at the very least, the chunk of money used for advertising and accommodation if you are independent can reduce the amount of tax you pay significantly.

Running your business as a sex worker doesn’t need to be complicated – you don’t have to set yourself up as a company or partnership or anything like that, although there are advantages with having a company.  As a self-employed (independent) escort, which we mostly are – even those who work at escort agencies who are officially contractors so the agencies don’t have to worry about PAYE (and agencies don’t seems to collect schedular tax) – at its simplest, we are sole traders.  This is probably the easiest way to do it, but I would like to be corrected if anyone has other ideas or can demonstrate other advantageous scenarios.

Getting a little more complicated, but you might also have to consider other taxes, like provisional tax (tax estimated and paid in advance) and GST.  If you earn more than $5000 per month consistently, you should register for GST, which isn’t that hard, except that you have to get an ACC code, and the one for sex workers spells things out a bit vividly as “95300 – brothel-keeping, massage parlour, and prostitution services” which could be off-putting for a working girl who has a concern about her anonymity.  Perhaps they could reword the category with a euphemism such as “personal services” or something equally as vague.  However, your information which the tax department and ACC hold would be confidential, and I believe is not accessible to possible future employers or anyone else.  I have asked the IRD and they say information about individual tax payers is kept private, but if this is not the case, they really should do something about that if they are wanting to get working girls to go legit.

You pay tax on your earnings after your tax-deductible expenses are taken out.  You pay GST on all your income before your expenses are taken out.  But you also get GST back for all the things you pay for.

You can pay tax throughout the year at Westpac banks, or wait until the end of the financial year and pay it after you have worked everything out and filed a tax return.  When you register for GST, you choose how often you will pay it, eg, monthly, two monthly or six monthly.  I think monthly or two monthly is best, because it forces you not to neglect or get behind with your accounts.

In summary, if you are a working girl, start keeping records of your money in and expenses out as soon as possible and open a bank account.  Keep receipts.