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HMRC internal manual

Business Income Manual

Miscellaneous income: particular sources: photography

S687-S689 Income Tax (Trading and Other Income) Act 2005, S979-S981 Corporation Tax Act 2009

If someone, other than by way of trade, makes a profit by selling a photograph they are chargeable under the miscellaneous income sweep-up provisions.

However if they sell the copyright then it is a capital transaction if the sale is not done as part of a trade and they are not liable under those provisions.

This comes from the decision of Lord Simon in Nethersole v Withers [1948] 28TC501 at page 517 where he said that the assignment of copyright in a film:

‘amounts to a sale of property by a person who is not engaged in the trade or profession of dealing in such property, and the proceeds of such a sale is, for Income Tax purposes, in the nature of untaxed capital and not in the nature of taxable revenue.’