Artists’ Exemption - €50,000 Tax Free
If you are an artist, you may be entitled to tax relief on profits up to a maximum of €50,000 per annum.
However, for these profits to be exempt from income tax, the work must meet specific criteria set out by the Revenue Commissioners.
If your work does qualify for the relief, it will be exempt from income tax (not PRSI or USC) in the year the claim is made, and future work within the same category will also be deemed to qualify.
To qualify for the relief, you must be resident, ordinarily resident and domiciled in an EU or EEA Member State, and your work must be one of the following:-
- A Book or other writing
- A Play
- A Musical Composition
- A Painting or Picture
- A Sculpture
For these works to qualify for the relief, Revenue must determine that it is original, creative and recognised as having cultural or artistic merit.
To make these decisions, Revenue often consults with other organisations, such as The Arts Council, following guidelines that they have produced.
In addition to income from the sale of works, the following payments are exempt:
- Arts Council Bursaries
- Residences paid by the Arts Council for producing a qualifying work
- Cnuas payments under the Aosdana Scheme
- Advance Royalties
- Sales of qualifying works abroad
These payments are included in the maximum amount of €50,000.
How to Claim
To get a determination, you must complete the Revenue form and provide the necessary samples of work, (e.g. three copies of the book).
Appealing Revenue’s Decision
If Revenue determine that your work is not eligible for the relief, or do not decide within six months of your claim being made, you have a right to appeal this decision to the Tax Appeals Commission (TAC).
To appeal this, you must submit the Notice of Appeal form, alongside a copy of the letter refusing the relief from Revenue to the TAC, within 30 days following either the determination or the end of the six-month period.
The most common cases brought to the TAC about Artists Exemption are in relation to works of non-fiction. To be classified as original and creative and as having cultural and artistic merit, works of non-fiction must meet guidelines set out by the Arts Council. The work must fall into a category, such as an autobiography or arts criticism book.
Regardless of the category, any non-fiction work must provide a unique insight and must be pioneering work that makes a significant contribution to the subject matter by casting new light or by changing the generally accepted understanding of the subject.
For example, you may have written a biography on a certain historical figure, which fits the guidelines. Still, the biography must also be unique and cast this person in a whole new light, containing information no other biography on this person has contained. Otherwise, it cannot be original and creative.
If you have any questions in relation to the above, or if you feel you may be entitled to this exemption, please contact a member of the Mazars private client team below:
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01 449 6480
Senior Tax Manager
01 449 6418
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