Hire Purchase Art Leasing for Businesses

Hire Purchase Scheme

Hire purchase

Acquire art in a tax-friendly way for businesses

The Tax Administration assumes that art does not depreciate in value. Art is therefore not depreciable or deductible.

A Hire-Purchase Arrangement can be a solution here.

Under this concept, entrepreneurs and self-employed professionals can enter into a leasing contract whereby, in exchange for a monthly amount, they rent an artwork for the medium term.

Renting is a deductible expense that can be deducted 100% for tax purposes.

The VAT rate changes from 6 to 21% but is offset.

At the end of the hire-purchase contract, the artwork is purchased. This option to buy out the residual value is for many a pleasant and financially attractive way to build an art collection without having to spend a large amount of capital themselves. It therefore lowers the threshold for buying art.

Renting art as decoration for your workspace is perfectly justifiable. If you are considering this route, it is best to draw up a rental contract in which you may also include a purchase option….

Dirk Van Collie

Alaska, tax advisers

Read the full article here

Are you a private individual and would you like to rent the artwork first before proceeding to purchase a piece? This is also possible; please get in touch for the conditions.