Tax deductions
Tax deductions for the purchase of works of art
In accordance with the first paragraph of article 238 bis AB of the CGI, only sums corresponding to the acquisition price of original works by living artists may be eligible for deduction.
The artist must be alive at the time of purchase of the work. In this regard, the company must ensure and, if necessary, justify the artist's existence on the date of acquisition of the work.
COMPANIES
Article 238 bis of the CGI establishes a special deduction for companies that purchase original works by living artists to display them to the public.
"Companies that purchase, from January 1, 2002, original works by living artists and record them in a fixed asset account may deduct from the profit of the acquisition year and the following four years, in equal installments, a sum equal to the acquisition price."
INDIVIDUALS
Wealth Tax exemption Works of art are not subject to the French Wealth Tax (ISF). They are not mentioned in the ISF declaration, and the amounts spent on their acquisition are not taxable. This tax provision applies to all types of works of art.
Capital gains taxation:
→ With an invoice, they can opt for:
- either the flat-rate tax of 5%,
- or the general capital gains regime.
→ Without an invoice, the seller will only have to pay the 5% tax which will be paid by the intermediary on behalf of the seller.
Under certain conditions, works of art can be included in the 5% furniture allowance for inheritance purposes.
⇒Payment in kind for certain taxes:
article 1716 bis of the CGI provides that the transfer of works of art, collection items, immovable property or securities to the State can constitute a means of payment for gratuitous transfer duties or partition duties.