Tax exemption
For companies and self-employed professionals in France, Monaco, Belgium and Luxembourg.
Leasing offers financial and tax advantages. This solution lets you spread the investment over several months and does not affect your borrowing capacity.
From a tax perspective, lease payments are deductible from taxable income and therefore reduce your corporate or income tax.
Leasing thus allows you to acquire works repeatedly while making significant savings.
Choice of the work and signature of the lease agreement
100% deductible lease payments — tax optimisation
End of lease: purchase option or other financial choice
The operation
- You lease the work for a period of 12 to 48 months.
- Lease payments are 100% deductible from earnings for the development and decoration of interior spaces (considered an operating expense).
- The work is displayed on the company's premises.
- The VAT on the lease is fully deductible.
- Leasing brings flexibility to the company; it can invest in an artwork while deducting 33% of its price and up to 75% for a self-employed professional subject to income tax.
- At the end of the lease, the works are transferred to a third party through a purchase option. The company renews the displayed works and allows a member of staff (an employee, shareholder or manager) to become owner at a lower cost.
The advantages
- Tax savings: the company deducts the entire monthly payment, included in deductible expenses for the development and decoration of interior spaces.
- VAT recovery: the company recovers the VAT (if subject to it).
- Spread of expenses: no impact on cash flow.
- Building a collection at lower cost: at the end of the lease, the financier agrees to sell you the work at its residual value.
Example for an acquisition amount: €10,000, estimated tax rate 31%.
How to set it up?
As soon as you have selected your work at the gallery, our team steps in to offer you the most attractive solution.
De Medicis Gallery instructs its leasing partners on your behalf. We offer tax-exempt and leasing solutions for the acquisition of artworks. We are responsible for setting up the file and the financial arrangement with the lessee.
The lessee buys the work from the gallery and leases it with a purchase option from the company. The lessee is therefore the owner of the work for the entire term of the long-term lease.
It is always the lessor who offers the company or a third-party beneficiary the buyback of the work at its residual value (5% to 7% of its purchase value).
Tax exemption through patronage
Tax exemption is offered to companies that acquire works by living artists.
Eligible companies are:
- Subject to corporate tax (by right or by option).
- Partnerships (taxable and commercial profits).
- The deduction is up to 20% of the work's price per year, for 5 years, capped at €20,000 or 5‰ of turnover per fiscal year.
- It is exercised on an extra-accounting basis on taxable income.
Transfer:
- In case of resale, capital gains tax is reduced after 2 years and removed from the 12th year.
- If use of the works changes or they are transferred, during or after the five-year deductible benefit period, the deduction amount received by the company is reintegrated into taxable income.
Conditions to qualify:
- The work must be produced by an artist residing in France or abroad.
- The work must be displayed with appropriate visibility in a public area accessible to employees, customers and suppliers throughout the work's amortisation period, i.e. 5 years.