Minister confirms Belgian freelance tax break
100% of publishers’ fees to freelances in Belgium can be treated as payment for “author’s rights”, Finance Minister Johan Van Overtveldt has confirmed. This can reduce the amount of Belgian income tax due on them. But the contract between the freelance and the publisher must specify that the payments are exclusively for the cession or concession of author’s rights and not for other services /(prestaties/prestations)/. So reports for conference organisers, minutes-taking, translations etc. are not covered by this arrangement.
The term “author’s rights” /(auteursrechten/droits d’auteur)/ is often translated into English simply as “copyright”, but author’s rights are more tightly defined in continental civil law. There is a strong implication that the rights derive from creativity and not just from effort. The nearest UK and Irish equivalent is “copyright (subsisting) in a literary, dramatic, musical or artistic work”. So not all copyright payments are necessarily for “author’s rights”. Freelance writers, photographers and artists need to bear this in mind when applying the Belgian rules. In many cases, “author’s rights” treatment of all fees will lower a freelance’s total tax bill in Belgium, but it also implies at least some deduction at source by the publisher, under a type of PAYE system. It is a good idea to seek advice from an accountant or the publisher’s finance department before choosing a solution.
The tax treatment of author’s rights has caused a lot of confusion in Belgium
over the years. A government circular issued last September made it clear that
publishers and freelances are free to reach their own agreements about how
author’s rights are paid out. But the Special Tax Inspectorate has continued to reject some journalists’ tax returns in cases where all of their fees were paid as author’s rights. The inspectorate is currently investigating 61 cases involving journalists, but the minister said it will have to take proper account of the circular when dealing with these. Due to all the uncertainties, publishers have tended to make their own decisions, often involving the payment of only a certain proportion of fees as author’s rights. This percentage has varied from publisher to publisher. Some of them are now taking a fresh look at the situation in the light of the minister’s comments.
He added that, as the circular was simply clarifying a law that dates back to 2008, the ruling also applies to situations that arose before the publication of the circular.
That goes for salaried journalists, too. But “for salaried staff, account must also be taken of social law provisions”.
The minister was responding to parliamentary questions on 25 February. A full provisional transcript of the discussion, in Dutch, is available here:
(point 08, beginning on page 10).
Thanks to Ian Graham.