Tax agreement signed with Switzerland

In principle, payments originating in France for artistic services provided by residents of a state having a tax agreement with France are only taxable in France (and thus are only subject to deduction at source in France) if the tax agreement stipulates nothing to the contrary.

Switzerland signed a tax agreement with France on 9 September 1966, and it does not depart from this principle.

It grants the state in which the service is performed the right to levy tax under certain conditions (article 19). The deduction at source thus applies (see fact sheet Deduction at source on artistic services ).

The conditions are as follows:

•      income “earned by the resident of one contracting state from work done in the other contracting state as an entertainment artist (…) is taxable in this other state”.

Nb >  We can infer from this that the income a Swiss resident artist earns from his artistic work done on French territory is taxable in France.

On the other hand, it states that if a substantial proportion of the artist’s activity is financed by public funds from the state of residence, from any of its local authorities or from a public law entity in the said state, the income is taxable in the state of residence.

•      If the “revenue from activities that an artist (…) personally performs in that capacity is awarded not to the artist (…) himself but to an intermediary, the said revenue is taxable in the contracting state” where the artist conducts his activity.

Nb >  As a result, the income a Swiss resident artist earns from his artistic work done on French territory is taxable in France, even if it is paid to an intermediary rather than directly to the artist.

On the other hand, this income is not taxable in the state where the artistic activity is conducted but in the state of residence if the intermediary is substantially or predominantly financed by public funds from the state of residence, from any of its local authorities or from a public law entity in the said state.

This agreement is available for consultation on the tax site  (www.impots.gouv.fr – click ‘documentation’ then ‘international’, section ‘search for a tax agreement’).