Tax exemption for the company

 

This is often not the main reason that pushes a company to invest in art, but the tax implications are obvious, and make it possible to optimize corporate tax.

 

Tax advantages in the context of the acquisition of a work of art for a company

 

The calculation of the tax exemption potential is obviously done on a case-by-case basis according to your financial and accounting data, based on your balance sheets.

Purchase :

The general tax code, more specifically its article 238 bis AB, provides for a tax deduction on the cost price of the work of art. This applies to the corporate tax result over 5 years: the year of acquisition and the following 4 years.

Example: if the company plans to acquire a work of art for an amount of 10 K€, this purchase would allow a tax deduction of 2,000 euros spread over 5 years.  

 

For this, it will be necessary to respect certain conditions, and in particular that the company exhibits the work of art in question in a place accessible to the public or to employees for 5 years.

On transfer:

At the end of the 5 years during which this acquisition has made it possible to reduce the taxable result of your company, 2 options are available to you if you do not wish to keep it:  

  • The law offers the possibility of benefiting from a corporate tax reduction within the framework of the patronage system . This tax reduction amounts to 60% of the value of the work of art at the time of the donation. To do this, the company must make a donation of the work in question under sponsorship to an organization of general interest.  

  • You can also sell this work of art, especially if you acquired it for the purpose of realizing a capital gain . In this case, this capital gain will be entered in the products of your income statement.

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MUSY supports you in the taxation of works of art


Giving you the ins and outs on the tax impacts if you buy one or more works of art for your company for your business, this is part of our mission!

This study is included in our support fees. It is carried out by business lawyers who have advised dozens of companies on their investment strategy: retention period, budget to be allocated, tax integration, tactics at the end of the tax relief period, etc.


If you wish to consider specific cases, either related to the legal structure of your company or to tax optimization wishes, our expert can of course complete his study.