Tax incentives
Tax Incentives for Businesses
How it works
Companies liable for the impôt sur les sociétés (corporation tax), or for income tax under the bénéfices industriels et commerciaux (BIC – industrial and commercial profits) regime, may claim a tax deduction when purchasing original works of art by living artists.
Key terms
- Tax deduction: The purchase price of a work of art may be deducted from taxable profits in equal instalments over 5 years (the year of purchase plus the following 4 years).
- Maximum amount: The annual deduction is capped at 0.5% of turnover excluding VAT. If the annual ceiling is exceeded, the surplus may be carried forward to subsequent financial years, within the overall 5-year limit.
- Display requirements: For the full period of the deduction, the work must be displayed somewhere accessible to the public or to staff (reception area, meeting rooms, communal spaces, etc.), individual offices excepted.
Eligible works
- Original works by living artists: paintings, sculptures, original photographs, installations, performance pieces, videos, etc.
- Purchased from the artist directly or from an authorised art-market professional: a gallery, an auction house, etc.
Tax Incentives for Private Individuals
The general rule
- No general scheme: Outside of charitable patronage (mécénat), buying a work of art does not entitle a private individual to an income tax reduction.
- Exception – IFI (Impôt sur la Fortune Immobilière): Works of art are excluded from the base of the IFI (French property wealth tax). They were never caught by the former ISF and are not caught by the IFI, which makes them a useful tool for diversifying personal wealth.
Inheritance & capital gains
- Inherited or gifted works of art: these enjoy favourable tax treatment when passed on.
- On resale, the specific tax regime for plus-values sur biens meubles (capital gains on movable property) applies, with flat-rate taxation subject to certain conditions.
Points to Watch
- The work must genuinely be on display
You must be able to prove that the work is on display in the event of a tax inspection (photographs, written statements, etc.). - Works by living artists only
The tax relief applies solely to original works of art purchased during the artist’s lifetime. - Recognised intermediaries
We recommend buying from professional galleries or auction houses, to guarantee authenticity and ensure the tax regime is applied correctly.
In Summary
- Profit-making businesses can acquire contemporary works and benefit from a tax deduction spread over 5 years, provided the work is on display.
- For private individuals, the main incentive lies in the exclusion of works of art from the IFI, together with favourable tax treatment on inheritance and resale.
- These schemes form part of France’s policy of supporting artistic creation and the art market.
Frequently Asked Questions (FAQ)
Can buying a work of art reduce my income tax?
No — unless the work is donated under a patronage (mécénat) arrangement that qualifies for a tax reduction.
Which works qualify for the tax relief?
Only original works by living artists, purchased from recognised professionals.
Must the work be kept on the company’s premises?
Yes — and it must be displayed there, in an area accessible to the public or to staff, for the entire period of the deduction.