Influencers’ income under the special copyright tax regime : fifty shades of grey

Abstract:In the context of influencer marketing, content creators regularly realise income from the exploitation of their intellectual property rights, which raises tax qualification issues. This chapter focuses on the special tax regime applicable to income from copyright, related rights, and statutory and compulsory licences. The conditions for the application of the special tax regime apply regardless of the taxpayer’s profession, which requires a case-by-case assessment, in this case in the context of influencer marketing. The first part of this chapter will therefore discuss the conditions that the income in question must fulfil in order to fall within the scope of the special tax regime. First, the taxpayer-content creator must qualify as a (co-)author or performing artist. It is particularly important here that he or she has room for his or her own free and creative choices in order to give the content a personal touch. Second, the taxpayer must transfer or license his or her rights to a third party. In the context of influencer marketing, this involves the contractual relationship with the sponsor on the one hand and the social media platform on the other. In particular, the contractual (general) terms and conditions regarding the use of intellectual property should be reviewed. In addition, the counterparties of the content creator must have the intention of exploiting the work or performance. In principle, this condition will give rise to few difficulties. The same applies to the last condition, namely that such exploitation must be for the purpose of reproduction or public communication. The second part of this chapter discusses the main features of the special tax regime. It considers, on the one hand, the capita selecta in the personal income tax and, on the other hand, the withholding tax system. Regarding the tax treatment of copyright royalties in the personal income tax, within certain thresholds such income is irrefutably and ipso jure considered movable income and subject to a separate 15% tax. If the content creator’s income exceeds the statutory threshold, it may be classified as professional income. This requires an assessment of the professional “use” of the rights, which can lead to ambiguities in the context of influencer marketing. Furthermore, from a tax perspective, it is important to check whether the influencer is working on behalf of the counterparty granting the remuneration. If so, there is an additional tax threshold to consider. With regard to withholding tax, the international context in which social media platforms operate should be taken into account.

ISBN:9789464662207

Publication year:2024

Accessibility:Closed