Private ruling: Special professional averaging
Published: November 2013
Ruling period: Year ended 30 June 2013 | Year ending 30 June 2014 | Year ending 30 June 2015 | Year ending 30 June 2016 | Year ending 30 June 2017
Date scheme commenced: 1 July 2012

Ruling: Q1: Are you considered to be a special professional for averaging purposes in relation to the creation of videos which you upload to an internet website? | A1: Yes

Relevant facts and circumstances: You produce videos that are posted on an internet website. You receive payment from an organisation based on the number of views your posted videos receive.

Relevant legislative provisions: Income Tax Assessment Act 1997 Division 405 | Income Tax Assessment Act 1997 subsection 405-25(1) | Income Tax Assessment Act 1997 subsection 405-25(2) | Income Tax Assessment Act 1997 subsection 405-25(3) | Income Tax Assessment Act 1997 subsection 405-25(4) | Income Tax Assessment Act 1997 subsection 405-25(5)

Reasons for decision: Summary: Division 405 of the Income Tax Assessment Act 1997 (ITAA 1997) covers special professional income. Subsection 405-25(1) of the ITAA 1997 states that you are a special professional if you are: (a) the author of a literary, dramatic, musical or artistic work; or (b) the inventor of an invention; or (c) a performing artist; or (d) a production associate; or (e) a sportsperson. Subsection 405-25(2) the of the ITAA 1997 explains that a performing artist is someone who exercises intellectual, artistic, musical, physical or other personal skills in the presence of an audience by performing or presenting. Subsection 405-25(3) of the ITAA 1997 expands the definition of performing artist to also include performing or appearing in or on a film, tape, disk or television or radio broadcast. A production associate is defined in subsection 405-25(4) as providing artistic support for the activities in subsection 405-25(2) or the activity of making a film, tape, disk or television or radio broadcast. Artistic support activities include services such as an art director, director, director of photography, film editor or producer to name a few categories from subsection 405-25(5). In your case, you produce videos that are posted on an internet website. This allows anyone with internet access to view your videos on demand. You are paid by an organisation on a per view basis for each video you post on the internet website. If nobody views your video, you receive no payment. The more people who view your video, the higher the payment received. You exercise your artistic and personal skills by performing for your audience via your videos posted on the internet website. In this aspect, you would be considered a performing artist. You provide further artistic support to the creation of your videos by performing the roles of producer, director, director of photography, editor and art director for each of the videos you create. In this aspect, you would be considered a production associate. As you fall within the definitions of both performing artist and production associate, you would be considered a special professional for averaging purposes.