Principle of the scheme

In France, businesses that purchase original artworks created by living artists may be entitled to a special tax deduction. The acquisition cost can be deducted from taxable profit, spread over five years, subject to conditions set by the tax code.

Eligibility conditions

• The work must be an original artwork by a living artist.
• The acquisition must be recorded as a fixed asset on the company balance sheet.
• The artwork should be displayed in a location accessible to the public or company employees (e.g., reception areas, exhibition spaces).
• All purchases must comply with the statutory timeframe and supporting documentation must be kept.

Limits and calculation

The deduction is applied over five years in equal portions. A ceiling applies — commonly expressed as 0.5% of annual turnover or an alternative monetary ceiling. The company chooses the ceiling that is most favorable.

Accounting treatment

Record the work as an asset and apply the special fiscal deduction spread over five fiscal years. Keep purchase invoices, certificates of authenticity and evidence of public or employee display in case of audit.

Advantages & risks

Advantages

• Reduction of taxable profit through the special deduction.
• Support for contemporary artists and enhancement of corporate image.

Risks

• Obligations of preservation and display; audits may require proof.
• Artworks are illiquid assets and market value is not guaranteed.
• The scheme is time-limited — check the legal validity before purchase.

Example

If a company has a net turnover of €200,000 and buys an artwork for €10,000, 0.5% of turnover equals €200,000 × 0.005 = €1,000. The deduction of €10,000 would normally be spread over five years (€2,000 per year), subject to the applicable ceilings and options.

Conclusion & advice

The special deduction for purchases of artworks by living artists can be an effective combination of tax planning and cultural patronage. Before proceeding, verify current legal terms, consult your accountant and keep thorough documentation.