... be paid after a performance
Everyone wants to get paid quickly after a performance. Moonlighting does happen, but it is not allowed, not even if you only get a couple of 10-euro notes for your performance. If the tax office finds out, you will still have to pay taxes retrospectively, and a fine on top!
If you do not have a Working Relationship Declaration - Profit from Enterpise (VAR-WUO) as a performing artist, you will have to go through freelance payrolling. As an artist or musician, the Performance Artists' Tax Regime (artiestenregeling) will then apply to you. If you earn less than € 163, the so-called facility for minor allowances may be applied. There are also an expenses facility and one to cover travel and accommodation expenses. These facilities ensure that you still retain (most of) your earnings.
The total fee statement form
Every time you perform and are paid in accordance with the Performance Artists' Tax Regime, you must fill in a total fee statement form. This form must state the total fee before tax. The employer must have this statement before he can pay you, so always take it filled in and signed when you go to do a performance.
Incidental Expenses Allowance Scheme
(Kleine vergoedingsregeling, KVR)
For whom: artist without VAR-WUO who earns a maximum of € 163 per performance
Every artist can be paid a maximum fee of € 163 per performance without deductions being made for social insurance or income tax. You must indicate on the total fee statement form that you wish to make use of this facility. If the total fee agreed upon is more than € 163, the difference must be payrolled in accordance with the Performance Artists' Tax Regime.
It is not a miraculous device to keep as much as possible of the fee free of tax! When you declare your income for tax purposes, you must indicate the compensation for expenses that you have received as income. If your actual expenses are lower, you pay tax over the difference.
The Expenses Exemption Ruling (Kostenvergoedingsbeschikking, KVB)
For whom: artists whose costs are more than € 163 per performance
If your costs per performance are higher than the limit allowed by the Incidental Expenses Allowance Scheme (€ 163), you can apply as an individual or a group to the Tax Office before the performance or a series of performances for application of the Expenses Exemption Ruling. In making such an application you must state clearly what your costs normally are and divide that amount over the estimated number of performances. In the cost deduction ruling, the inspector states the total general costs allowed per performance. A copy of the ruling must be appended to the total fee statement form for the employer, so that he or the payrolling agency knows that that total of general costs can be applied. The Incidental Expenses Allowance Scheme and the Expenses Exemption Ruling cannot both be applied at the same time.
The travel and accommodation expenses facility
For whom: every artist who incurs travel expenses (apart from expenses involving his own means of transport)
Compensation for travel and accommodation expenses need not be taxed. That does not have to be stated on the total fee statement form either. Compensation, or allowances if the employer pays these expenses directly, for travel and accommodation expenses remain untaxed at the request of the artist. An exception is made for compensation for the expenses of the artist’s own means of transport, such as the expenses of travelling in the artist’s own car. This compensation is taxed, but you can include it in the Incidental Expenses Allowance Scheme and the Expenses Exemption Ruling
What if you earn more?
If you do not have a VAR-WUO as an artist and your income is higher than the limit of the facilities mentioned above, you must have the fees that you receive for a performance payrolled in accordance with the Performance Artists' Tax Regime. In that case you must fill in the income from performances on the declaration of your income for tax purposes under the category ‘result from other activities’. You can deduct the professional expenses for income tax, but you are not a freelance and cannot issue invoices.
Liability for deductions statement: if you perform as a group
If you play in a band or perform in a company, you can send invoices as a group if you have a liability for deductions statement. That means that you have to pay income tax and employees’ contributions as a group. Then for example the profit can be divided among the permanent members of the band at the end of the year.