TL;DR: In France, authors of intellectual works and performing artists benefit from specific tax regimes for VAT (exemption under turnover thresholds) and income tax (special regimes for royalties, allowances, and exemptions such as the CFE). Declarative and accounting obligations are simplified for those eligible for VAT exemption.
VAT regime for authors and artists
Authors of intellectual works and performing artists are subject to VAT but may benefit from VAT exemption if their sector-specific turnover thresholds are respected. These specific thresholds replace those of Article 293 B of the French General Tax Code (CGI). Authors and artists not established in France may also benefit from this exemption for operations carried out in France, provided they comply with the thresholds of I bis of Article 293 B of the CGI and the European threshold of €100,000.
Amounts related to private copying remuneration and “equitable” remuneration are excluded from the turnover calculation and are not subject to VAT.
For ancillary activities (non-artistic), the exemption applies if the turnover of the previous year does not exceed €35,000. During the year, it ceases as soon as the threshold of €38,500 is exceeded. For new professionals, the thresholds are adjusted proportionally to the remaining duration of the year.
Withholding tax and third-party obligations
Publishers, collective rights management organizations, and producers must withhold VAT on patent rights paid to authors, unless the author explicitly waives this. This waiver, valid for 5 years, must be notified to all concerned parties and the tax authorities. It takes effect on the first day of the month following its declaration.
Taxation of royalties
Royalties fully declared by third parties are subject to income tax according to the rules applicable to salaries and wages (Article 93, 1 quater of the CGI). This regime does not apply to performers (singers, actors, comedians, etc.), who remain subject to the rules for non-commercial profits (BNC).
Special regimes for income tax
Authors of intellectual works may opt for the regime under Article 100 bis of the CGI, which allows the taxable income to be calculated by subtracting the average expenses of the two or four previous years from the average revenue of the same period.
They also benefit from a 50% allowance on taxable profit for the first year of activity and the following four years (Article 93 of the CGI).
Declarative and accounting obligations
Beneficiaries of VAT exemption have no specific declarative obligations beyond those provided in VI-A § 460 of BOI-TVA-DECLA-40-30. They may keep a simplified accounting system: an annual register of purchases and a daily journal of professional income. Authors whose royalties are fully declared by third parties and subject to income tax as salaries and wages are exempt from this accounting for such income.
Exemptions and benefits
Authors and performing artists are exempt from the Cotisation Foncière des Entreprises (CFE) for their non-commercial and assimilated activities.