Artists' Exemption Information and Guidelines

Introduction

Section 195 Taxes Consolidation Act 1997 (TCA 1997) empowers the Revenue Commissioners to make a determination that certain artistic works are original and creative works generally recognised as having cultural or artistic merit.

For 2015 and subsequent years the first €50,000 per annum of profits or gains earned by writers, composers, visual artists and sculptors from the sale of their work is exempt from income tax in Ireland in certain circumstances. For the years 2011 to 2014 the maximum amount which was exempt was €40,000.

Guidelines have been drawn up by the Arts Council and Minister for Arts Heritage and the Gaeltacht, with the consent of the Minister for Finance, for determining for the purposes of Section 195 whether a work is an original and creative work and whether it has, or is generally recognised has having cultural or artistic merit. The Revenue Commissioners may consult with a person or body of persons, such as The Arts Council, which may be of assistance to them in reaching decisions in relation to Artists’ Exemption.

The scheme provides that the Revenue Commissioners can make determinations in respect of artistic works in the following categories only:

  1. a book or other writing
  2. a play
  3. a musical composition
  4. a painting or other like picture
  5. a sculpture

Claimants for Artists’ Exemption must be resident or ordinarily resident and domiciled, in an EU Member State or in an EEA State, and not resident elsewhere. The Revenue Commissioners are prepared to give advance opinions regarding a work of prospective claimant’s resident outside of the EU/EEA. In the event that a favourable advance opinion is given, the prospective claimant will be advised to make a formal application for a determination on taking up residence in the EU/EEA.

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How to Obtain a Determination

Writers, composers, visual artists and sculptors seeking Artists’ Exemption should submit a claim form to the Revenue Commissioners together with samples of their work and any supporting documentation in the form of testimonials, etc. which they consider appropriate. Such claims should be also accompanied by evidence that their work has been published, produced or sold.

Any income earned from a work before the tax year in which the claim is made will not be exempt.

Claims for Artists' Exemption should be made on pdfClaim form Artist 2 (PDF, 348KB). A determination granted on the basis of this claim form will cover the particular work or works submitted with the claim as well as all future qualifying works in the same category, provided they fall within the guidelines.

Depending on the category in which artists exemption is being claimed the following items should be submitted in support of a claim

  1. a book or other writing - three published copies of the book, if self-published proof of sale or relevant information and links in the case of ebooks,
  2. a play - a copy of the script along with a signed production contract,
  3. a musical composition - CD’s on which claimant is accredited with the music/lyrics,
    with evidence or royalty statements from IMRO or PPI,
  4. a painting or other like picture - six good quality photographs of the work together
    with evidence of sale, i.e. receipts/bank statements and a brief CV of artistic career to
    date,
  5. a sculpture - as at (d) above.

Advance opinion for Non- Residents

Revenue will give an advance opinion to individuals resident outside the EU/EEA. In the event that the individual becomes resident in the EU/EEA and is not resident elsewhere, a formal determination will then be made. Applications should be made on pdfApplication form Artist 3: advance opinion for non-resident (PDF,465KB)

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Advance Royalties

Where a taxpayer receives advance royalties, which are attributed to the subsequent publication of a book or other writing, a claim must be made with the Revenue in the tax year in which the royalties are paid if the royalties are to be exempt. Confirmation from the publisher that the book will be published must accompany the claim.

Where a claim is received in the tax year in which the advance is received, but where a determination has not been granted, any tax liability arising on the advance must be paid. If a determination as to exemption is subsequently granted, the Inspector of Taxes will review the taxpayer's liability and make any appropriate refund if tax has been overpaid.

Advance royalties paid in the year before a claim is made are not exempt. The normal accounting rules concerning the recognition of income will apply.

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Grants/Awards/Prizes

These are generally taxable as income. Whether they qualify for the exemption is determined by whether they are related to a work of the artist, which has been determined by the Revenue Commissioners as qualifying for the Artists’ Exemption scheme. Where the grant, award or prize is related to a work that comes within the scheme, the income from the work and from any grant, award or prize, which is exempt, is subject to the maximum amount of €50,000 from the tax year 2015 and €40,000 for the years 2011 to 2014.

Similarly in relation to the following items, these are regarded as qualifying as exempt income,subject to the overall maximum relief figure, where they are associated with a work which is determined by the Revenue Commissioners as qualifying for the Artists’ Exemption scheme:

  • Arts Council Bursaries when paid directly to the individual by the Arts Council
  • Cnuas payments made under the Aosdana Scheme.
  • Payments from the sale of qualifying works abroad which fall within the Guidelines
  • Residencies when paid directly to the individual by the Arts Council for the purposes of producing a qualifying work. (Residencies which relate to teaching art or similar type practice do not qualify for exemption).

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Right of Appeal

A claimant has a right of appeal if the Revenue Commissioners do not make a determination in relation to the claim within six months of the claim being made. The appeal must be made by notice in writing to the Revenue Commissioners and it must be made within 30 days following the end of the six month period.

The normal provisions of appeal in relation to the hearing/rehearing of appeals and the stating of cases for the High Court apply

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Universal Social Charge

Artists’ Exemption provides only for an exemption from income tax. From the tax year 2011 the Universal Social Charge is payable on gross income, including income which is exempt under the Artists Exemption scheme, after any relief for certain capital allowances, but before pension contributions.

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PRSI ,VAT and the High Earners Restriction

In certain circumstances artists exempt income may be subject to PRSI, VAT and the Higher Earners Restriction.

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Freedom of Information

In the event of an individual receiving a favourable determination the individuals name and the type/title of their work will be published on the Revenue website in accordance with the Freedom of Information Acts.

Determinations made since 1st April 2002 are published on the revenue website under:

Artists Exemption - Individuals who received a favourable determination in the period since 1 April 2002 - Section 195 TCA, 1997

Determinations made in the period 21st April 1998 to 31st December 2001 are at:

pdfArtists Exemption - Individuals who received a favourable determination during the period 21 April, 1998 to 31 December, 2001 - Section 195 TCA, 1997 (PDF, 446KB)

Further Information

Further information regarding the Artists’ Exemption scheme can be obtained from:

Office of the Revenue Commissioners,
Artists’ Exemption Unit,
1st Floor,
Stamping Building,
Dublin Castle,
Dublin 2,
Ireland.

Tel: + 353 1 647 5000 Ext:. 48011, 48684 or 48224
Fax: +353 1 679 9287
e-mail: direct-taxes-admin@revenue.ie

Artists Exemption Guidelines

February 2015


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