The performance fee is the top line of the invoice. Commission, tax and costs all come off it, so what reaches the artist is smaller than the number in the offer.
What comes off
- Booking agent commission, usually 10 to 15 percent in Europe.
- Manager commission, often 15 to 20 percent of gross income.
- Withholding tax at source in some countries. Germany, Spain and Austria all deduct from foreign artists.
- Travel, accommodation, crew and backline hire, where the promoter does not carry them.
Gross and net
A fee quoted net means the artist receives that amount and the promoter carries tax and costs. A fee quoted gross means the deductions come out of it. State which one applies in the offer, because the difference between a gross and a net €2.000 runs to several hundred euros.
VAT
Whether to invoice with VAT depends on where both parties are established. Inside the EU, business-to-business services are usually reverse-charged to the promoter. Have an advisor set the rule once, then apply it to every invoice.