How to make payment for a resale

Which party is required to pay the royalty?

The following persons are jointly and severally liable to pay the 5% resale royalty to RRA:

• The seller, and either
  • the agent acting for the seller on the resale (usually the AMP); or
  • if the seller does not have an agent, the agent acting for the buyer on the resale; or
  • if there are no agents, the buyer.

When is the royalty payable to Resale Royalties Aotearoa?

The royalty is payable to RRA within 60 working days after the later of either:

1. the completion of the qualifying resale (or)
2. on the earliest date on which person(s) liable for payment becomes aware of liability.

When is the royalty distributed from Resale Royalties Aotearoa to the visual artist?

Once RRA has received the total royalty payment from the liable person(s) we are required to distribute to the right holder in a timely manner (provided the right holder can be found). We distribute 80% of the royalty collected to the eligible right holder and retain 20% of the royalty for the purpose of funding RRA’s operations under the Scheme.

GST?

The current guidance from IRD:

• The resale payment is exempt from GST when the art professional (for example an art dealer or gallery) passes it to the collection agency.
• The collection agency does not need to pay GST on the percentage of the resale payment that it keeps.
• The resale payment must include GST when the collection agency passes it to the artist, if the artist is registered for GST.

Full IRD Guidance is published here: Resale payments for artists (ird.govt.nz)