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Artist Social Security

The System

The German social security system for self-employed artists is unique worldwide: a blessing for artists, an occasional annoyance for users of artistic performances liable to pay taxes. Under the German law regulating social security arrangements for artists [KSVG] both self-employed artists and publicists have been subject to compulsory insurance deductions in the statutory health and pension insurance scheme. Therefore the law does not allow artists and publicists[1] to decide for themselves whether they should obtain social security cover but stipulates that this is an obligatory insurance from which nobody who is liable to be insured may voluntarily withdraw.



However the law does not only affect insured persons. It also obliges all users of artistic output – which in the live entertainment branch refers to organizers and under certain circumstances also includes artist’s agents – to make payments. This means that for each amount paid in remuneration to a self-employed artist – for example, an artist’s fee for a performance – they are obliged to make a contribution to the German Social Security Fund [KSK]. Whereas the contributions made by insured persons cover one half of the costs of running the system, the costs of running the other half – in addition to a subsidy drawn from the federal budget – are borne by the users. Users are defined as any company or institution that regularly markets artistic or journalistic works and pays royalties for doing so.



However from a legal point of view it is not a tax but rather a levy or contribution, a costs compensation procedure, applied to any entity that in principle and regularly markets artistic production. What in particular singles out this levy is the fact that it is payable regardless of whether the artist is actually insured by the German Social Security Fund. Even the question regarding whether he is even entitled in principle to draw benefits under this German social security system – which for example is not the case if persons have established their domicile abroad – is as irrelevant when it comes to determining whether he is obliged to pay this levy as the question regarding whether the artist is otherwise insured under a social security scheme as an employee (e.g. in the orchestra of a radio station). The only deciding criterion is whether the person was paid his fee in the particular case for a work produced in the capacity of a self-employed artist.
  [1] For the sake of simplicity, hereinafter no additional reference will be made on each occasion to publicists, likewise insured under this law.
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