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V1787-19 11 July 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · cesión de derechos de autor

Copyright transfers are exempt from VAT, but musical performances are not

An author has enquired about the VAT and Income Tax (IRPF) treatment regarding the transfer of rights for a musical work and its promotional performances. The DGT has ruled that while the transfer of rights is exempt from VAT, musical performances are subject to the tax.

The question raised

Taxation under VAT and Personal Income Tax.

The DGT's ruling

The assignment of copyrights by a musical composer is exempt from VAT pursuant to Article 20.One.26 of Law 37/1992. However, services other than the assignment of rights, such as musical performances, are subject to the tax. For Personal Income Tax purposes, income from the assignment of rights is classified as income from employment if there is no organization of production means. Pro bono performances do not generate income for Personal Income Tax purposes if their gratuitous nature is proven.

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