Authors who self-publish their books will be taxed as economic activities

The nature of income obtained from literary creation has raised doubts regarding its correct tax classification for Personal Income Tax (IRPF). Recently, the Directorate General of Taxes (DGT) has delimited the boundary between income from employment and income from economic activities in the context of self-publishing.

What the DGT has resolved

The administration has determined that when an author decides to self-publish their work, the income derived from such exploitation must be classified as income from economic activities. The criterion establishes that the distinction lies in the management of the exploitation: if the publication is carried out by a third party to whom the exploitation rights are assigned, the income maintains its character as income from employment.

However, when the author assumes direct management of the editing and sale, an economic activity structure is formed. In the event that the author already carries out a prior professional activity, the remuneration for the assignment of rights will be integrated into their usual income from professional activities.

What this means for you

If you are a content creator or writer who has decided to forgo a traditional publisher to manage your own book sales, your tax situation changes. You will not be able to declare this income as simple income from employment derived from the assignment of intellectual property rights.

This classification implies that you must comply with the tax obligations specific to a professional or entrepreneur, which involves accounting and income management different from that of an employee or a mere assignor of rights.

What is advisable to do

It is necessary to analyze the commercialization structure of your works. If your business model is based on direct self-publishing, you must prepare your accounting to declare this income as an economic activity. Since the tax classification depends on how the exploitation of rights is managed, it is fundamental to assess each particular case to ensure that your income tax return aligns with the reality of your professional activity.