Income tax Dates
Eligible artists are entitled to receive a payment each time their art is resold (a resale payment). These payments may be taxable.
The resale payment is a set percentage of the resale price. The art professional (for example, an auction house or gallery) resells the artwork and passes the resale payment to a collection agency. The collection agency passes the resale payment to the artist.
If you are an artist who was in business when the artwork was created, you need to pay income tax on resale payments for that art. This is because resale payments are not taxed before they are paid to artists.
My income is not taxed before I get paid
Eligibility for the resale payment
Resale payments are administered by Resale Royalties Aotearoa Toi Huarau. You can check your eligibility for the resale scheme and how to receive a payment on their website. The resale scheme begins on 1 December 2024.
Resale Royalties Aotearoa | Toi Huarau
Tax implications for artists
For an artist who was in business when they created their artwork, a resale payment received for that art is taxable income, whether it comes from a resale made in New Zealand or overseas.
If you live:
- in New Zealand and your art is resold overseas, you must pay income tax in New Zealand on the resale payment
- overseas and your art is resold in New Zealand, you must pay income tax in New Zealand on the resale payment.
Overseas sales and double tax agreements
New Zealand will have reciprocal resale payment agreements with Australia and the United Kingdom (UK). Artists living in those countries will receive the resale payment when their artwork is resold in New Zealand.
Artists living in New Zealand will receive a resale payment when their artwork is resold in Australia or the UK.
New Zealand has double tax agreements (DTAs) with many countries. DTAs can affect the incomes of New Zealanders who live overseas, or New Zealand residents who receive overseas income.
Important: we recommend that you ask a tax professional for advice.
Non-resident withholding tax
Non-resident withholding tax does not need to be paid on resale payments.
When an artist has died
When an artist dies, the resale payment goes directly to the beneficiaries under their will, or to their estate. In these situations, the resale payment is not taxable income. The artist’s beneficiaries or estate will not need to pay income tax on the resale payment.
The artist's estate or beneficiaries can decide to transfer the rights to future resale payments to a third party. However, the tax outcomes may be complex. We recommend that you ask a tax professional for advice.