Artists & Writers TaxLinks

Canada Revenue Agency’s IT 504 sets out special tax rules for visual artists and writers. Eileen's webpage is an attempt to unravel  the murky world of reasonable expectation of profit, inventory, home office work space, meals and entertainment, gifts and donations in kind, what to deduct for self-employed writers and when a business is considered a separate business.  

Every few years Eileen offers a course, never very well attended, often cancelled due to low sign up, as most artists and writers don't pay much tax in Canada.  Sad but true.

Here's one testimonial:

 I found the one hour tele-class, Workshop for Artists and Writers, fantastic. The whole thing was a new experience for me. Listening to Eileen speak and being able to ask questions as I followed her online, made it easy to understand why I needed what I needed and where I could find it. I may still shudder when it comes to income tax; but at least now, there’s some smart in my shudders. Thanks Eileen. 

Cathy Mayovsky, October 2008  

General Info: applies to Artists & Writers
Keeping Records
Employment Standards
IT473 Inventory Valuation
IT521 Motor Vehicle / Self-employed
Home Office
IT514 Work Space in Home
IT518 Food, Beverages & Entertainment
Artists, Entertainers & Performers
IT504 Visual Artists & Writers (incl employees)
IT525 Performing Artists
IT472 Class 8 Capital Cost Allowance
IT472 Special release
IT75-6R2 Required Withholding Amts Paid to Non Res
Film Industry Services-Nonresidents & Tax Credits
Artists generally
IT75 Grants
Tuition fees, scholarships & bursaries (employee)
IT257 Canada Council Grants
IT 288 Gifts capital property to charity
IT340 Scholarship fellowship bursary researchgrant
IT340 Update
P113(E) Gifts and Income Tax
IT 334 Miscellaneous Receipts
P195 Rebate for Artistic Works Produced for Export
IT533 Interest deductibility
IT407 Dispositions of Cultural Property
P167 Definition of Business
P176 Profit test
IT206 Separate businesses
Employed artists
Line 229 Other employment expenses
T777 Statement of Employment Expenses
GST370 GST/HST Rebate
Travel expenses: employees
Commission employees: Expense Types
Capital Cost Allowance (Computers)

Report from Finance January 18, 2011 

Specific to Artists and Musicians

Assistance for Artists

Objective: The special treatment of costs incurred by artists recognizes artists' problems in valuing their works of art on hand, attributing costs to particular works, and carrying inventories over long periods of time. The special election with respect to a charitable gift from an artist's inventory removes an obstacle to artists donating their works of art to charities, public art galleries and other public institutions. (Budget Papers, 1985)

Some artists who are self-employed may deduct the costs of creating a work of art in the year the costs are incurred rather than in the year the work of art is sold.

Artists may also elect to value a charitable gift from their inventories at any amount up to its fair market value. This value is included in the artist's income. The percentage of income limit for the Charitable Donations Tax Credit does not apply.

No data are available.

Deduction for Artists and Musicians

Objective: The deductibility of certain expenses incurred by artists and musicians recognizes that these expenses are necessary to carry on employment in those fields. (Musical Instruments: Income Tax Reform, 1987)

General recognition of employees' work-related expenses in the income tax system is provided on a limited basis through the Canada Employment Credit. In addition, specific recognition is provided for extraordinary work-related expenses incurred by certain occupations.

In this regard, employed musicians are able to claim the cost of maintenance, rental, insurance and capital cost allowance on musical instruments against employment income earned as a musician. Employed artists are also entitled to deduct expenses related to their artistic endeavours up to the lesser of $1,000 or 20 per cent of their income derived from employment in the arts.

No data are available. 




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