An art lover wishing to acquire a work of art will find the tax advantages of this investment still preserved. 

 

ENTREPRENEURS, FOCUS ON LIVING ARTISTS

Since 2002, companies have an incentive to acquire original works of art by living artists. They can deduct their cost from the company’s profits in the year of acquisition and the next four years (up to 0.5% of each year’s business revenue).

But be careful, the work must be exhibited to the public or employees throughout the entire deduction period.

 

SALE: TWO REGIMES POSSIBLE...

At time of sale, works of art are in principle subject to a flat tax of 6.5% (including the 0.5% Social Debt Reimbursement Contribution or “CRDS”) once their sale price exceeds €5,000. Be careful, this tax applies to the sale price and not to realised capital gain.

The taxpayer, however, has the option of submitting the transaction instead to the capital gains regime on moveable goods. In that case, the capital gain is taxed at the global rate of 34.5% (including 15.5% social security contributions). The tax base is reduced by 5% relief per year after the 2nd year of ownership, which makes the asset fully exempt after 22 years of ownership. (For the record, prior to 1 January 2014, the relief was 10% leading to full exemption after only 12 years of ownership.)

 

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