Buying art and tax exemption

Buying art and tax exemption

Buying art and tax relief for companies operating in France

Acquisition of works by living artists by companies and the professions

Article 238bis AB of the General Tax Code states that: "companies that acquire works by living artists may deduct from their profits for the year of acquisition and the following 4 years, in equal shares, a sum equivalent to the purchase price of the work. Under this mechanism, 20% of the purchase price of works by living artists can be deducted each year for 5 years.

Click here to consult the relevant article of the CGI (French General Tax Code)

This tax advantage is subject to 4 conditions:

  • The works acquired must be included in a fixed asset account.
  • The deduction for each financial year must not exceed 0.5% of the year's turnover.
  • The work must be exhibited for 5 years in a place that is freely accessible to the company's employees and visitors.
  • The company must enter a sum equal to the deduction made in a special reserve account on the liabilities side of the balance sheet, bearing in mind that this sum will be added back to taxable income in the event of a change of use or sale of the work or a withdrawal from the reserve account.

Buying art and tax relief for individuals resident in France for tax purposes

Works of art are not subject to the IFI (property wealth tax). Works of art eligible for tax relief are listed in article 98 A of the French General Tax Code.