Resale Royalty Scheme – Australia

The Australian Government’s Resale Royalty scheme is about to take effect on the 9th of June 2010.

The royalty will apply to works by living artists and lasts for 70 years after death – so currently to all artists who died after 1941.

Basically, all such works of art purchased after the 8th of June 2010 will be subject to a resale royalty of 5% when next sold.
Importantly, all works purchased before that date will be exempt on the next sale – but not subsequent sales.

For example
If you buy a work on the 1st of June 2010 and sell in 2013, the royalty will not apply. If you buy it on 15th of June 2010 and sell in 2013 it will apply. If the work is a Streeton, (who died in 1943) you pay; if you defer the sale to 2014 you won’t.
Royalties will apply to sales of $1,000 including GST and over.

Resale Royalty is triggered by a change of ownership – and this includes inheritance and gift. So, a painting bought in 2005 and then inherited or gifted in 2015 and then sold in 2020 will attract the 5%.

Demonstration of exemption for future sales will rely on providing evidence. The collection agency (CAL) is advising collectors to make an inventory of their current holdings as at 8th June 2010, and lodge it with their accountant.

I have asked, but received no answer, about the status of ‘internal’ sales eg between say John Smith’s personal collection, Smith Investments Pty Ltd, Smith Superannuation Fund, etc. I suggest that if you are contemplating any such move, that you take professional advice and act before the 8th of June 2010 if applicable.

The same will apply to any works of art you are currently contemplating buying. Any sale finalized before the starting date will at least be exempt on the next sale.

Disclaimer
The above is essentially a matter of law, not art. I’m not a lawyer, and don’t fully understand the ramifications and complexity of the situation. This email is offered as a friendly suggestion and not as professional advice. It is made without liability.

Charles Nodrum

Director, Charles Nodrum Gallery

Comments

2 Responses to “Resale Royalty Scheme – Australia”

  1. Aboriginal Paintings on June 14th, 2010 9:58 pm

    Very useful information… This is only applied on resale of art work and aboriginal paintings. Am I right?

    and not on new purchased….

  2. john walker on August 9th, 2010 8:54 am

    Charles I would guess that in the case of transfers of title where no actual money changes hands, the royalty would be 5% of $0 =$0.
    For myself, on the case by case basis allowed by clause 22/23, will be not collecting any royalty.