The Government has clarified their position on tax relief for recording artist advances.
The music trade organisations UK Music and the Featured Artists Coalition, sought formal clarification from HM Treasury on the ability of creators to average profits in successive years within the existing tax framework, and specifically whether this could be applied directly to artist advances.
David Gauke MP, Financial Secretary to the Treasury, said in a letter responding to both organisations, “I am happy to confirm that the advance of royalties are within the scope of the averaging rules for creators of literary or artistic work. The advance of royalties is exactly the sort of situation these provisions are intended to address for creative artists such as recording artists”.
Welcoming the clarification UK Music CEO Jo Dipple commented, “I am pleased that Government has clarified that recording artists must be treated by HMRC the same way as other creators with regards the averaging of profits over successive tax years. I encourage eligible artists to make full use of this clarification.”
Shoeing in a quote, FAC Chair Sandie Shaw said, “Recording artists are prone to fluctuating finances. A very good year can then often be followed by one which isn’t so profitable, I am delighted that there is a mechanism in place which can allow Featured Artists Coalition members to not be disadvantaged by the tax system and one that respects the nature of our creative endeavours”.
Sandie didn’t however add that she was “socking it to the man” or “footing the bill”.
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