The artworks are subject to the advantageous Capital Gains Tax owing to the possibility to choose between two options
• A flat tax rate of 6,5% of the selling price
• A capital gains tax related to the taxation system of furnishings
» The flat tax rate on artworks:
It is possible to discharge the flat tax rate of 6,5% (including the french SDRC: Social Debt Repayment Contribution). This flat tax rate is equivalent to the Capital Gains Tax.
The possibility to choose to be subject to the capital gains tax regime on furnishings remains feasible.
The option for the general regime will prove valuable if :
– the work of art has been owned for over 22 years (total exemption) or
– the work of art has been inherited in less than 2 years and is the object of an auction sale (the value of the transfer of assets is then assimilated to the value-creation proper to the inheritance . The capital gain is de facto nonexistent.
» The general regime of capital gains on furnishings:
In that case, it is necessary to determine the amount of the capital gains.
This equals the difference between the net price of the transfer of assets (Commission services for instance) and the net price of the acquisition and the renovation of the artwork.
The seller will have to pay a 31,5% tax on capital gains with a deduction of 5% each year beyond the 2nd year. That is to say a total exemption from capital gains tax after 22 years of ownership.
Do not worry, We Art Partners will be there to support you by offering the best solution possible.
The French Wealth Tax
The Inheritance System
Lease with Option to Purchase
Acquisition of Artworks from Living Artists