Music trade organisations UK Music and the Featured Artists Coalition (FAC) have both welcomed clarification over tax relief for advances for music creators.
Previously, both bodies requested clarification from HM Treasury on the ability of creators to average profits in successive years within the existing tax framework, and whether this could be applied directly to artist advances.
In a letter in response, David Gauke MP, financial secretary to the Treasury, said: ‘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.’
Mr Gauke also welcomed the industry’s offer of input into how HMRC could better define averaging rules within tax guidelines.
Commenting, Sandie Shaw, FAC chair, 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 FAC members to not be disadvantaged by the tax system and one that respects the nature of our creative endeavours.’
Jo Dipple, UK Music CEO, added: ‘I am pleased that the 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.’
Visit the FAC and UK Music websites to find out more.
Previously, both bodies requested clarification from HM Treasury on the ability of creators to average profits in successive years within the existing tax framework, and whether this could be applied directly to artist advances.
In a letter in response, David Gauke MP, financial secretary to the Treasury, said: ‘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.’
Mr Gauke also welcomed the industry’s offer of input into how HMRC could better define averaging rules within tax guidelines.
Commenting, Sandie Shaw, FAC chair, 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 FAC members to not be disadvantaged by the tax system and one that respects the nature of our creative endeavours.’
Jo Dipple, UK Music CEO, added: ‘I am pleased that the 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.’
Visit the FAC and UK Music websites to find out more.
