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Guest Article | Taxing the Olympics and Paralympics

Last updated: 10 Jun 2024 09:00 Posted in: AIA

This summer, the Olympics (26 July to 1 August) and the Paralympics (28 August to 8 September) will be held in Paris, France. Athletes will compete in various sports disciplines for gold, silver and bronze medals and spectators can follow their sporting battles, live in the venues or at home on television.

Even though the Olympics and Paralympics themselves do not offer prize money, the athletes will earn income from other sources. Other organisations, companies, legal entities and stakeholders, including the International Olympic Committee (IOC), will also receive earnings from their activities around the tournaments.

This article will discuss how these earnings will be taxed, especially for non-residents visiting France in a short period of time.

National law and bilateral tax treaties

For personal and corporate income tax, the normal relationship between national tax law and bilateral tax treaties is relevant for Paris 2024. There is no taxation possible without a tax clause in the national law and most countries have included very broad taxing rules for non-residents in their legislation. This is also the case for France, which wants to tax almost every payment leaving the country. There are two reasons for this broad approach of source taxation:

  • obtaining tax revenue for the source country; and
  • preventing the possibility that the non-resident might not pay tax anywhere.

The French withholding tax rates are 25% general and 15% for non-resident sports players, while the normal tax rates are 25% corporate income tax and 11% to 45% personal income tax. However, in normal situations, the home country of the non-resident company or person will also tax this income from France as part of the worldwide income. This would lead to double taxation if nothing was done.

To tackle this issue, countries have concluded bilateral tax treaties, dividing taxing rights amongst each other, taking away this double taxation. These bilateral tax treaties are stronger than national law and lead to exemptions (or tax credits) in the source or the home country. France has around 100 bilateral tax treaties with various countries and these are relevant for these Olympics and Paralympics.

OECD Model followed by France

Most bilateral tax treaties are drawn up after the OECD Model Tax Convention. This Model has the following general rules for different types of income:

  • Article 7: Companies and self-employed persons: Profits will only be taxed in the home country, unless the company has a permanent establishment in the source country, in which case the source country can tax the profit of that permanent establishment.
  • Article 15: Employees: Income from employment is taxed in the home country, unless the work is carried out in the source country. However, there is an exception that employees working for an employer for up to six months in the source country can be taxed in the home country.
  • Article 12: Royalties: Taxation for royalties takes place in the home country.
  • Article 17: Sportspersons (and entertainers): Work carried out by a sportsperson or entertainer is taxed in the source country when the work is done there. This is also the case when the fee is paid to another party, such as the team or a company representing the sportsperson.
  • These types of income will all arise at the 2024 Paris Olympics and Paralympics. France follows the OECD Model as much as possible in its bilateral tax treaties.

Practical use for companies in Paris 2024

Non-resident organisations, companies, legal entities and self-employed workers involved with the 2024 Olympics and Paralympics will fall under Article 7 of the bilateral tax treaty of their home country with France. This means that France can only tax their French source income if they have a permanent establishment in France. This requires a fixed place of business to have existed for a longer period, most often more than one year.

Without a permanent establishment, France cannot tax the French source income, and this will be the case with most foreign entities and self-employed persons working for or around the 2024 Paris Olympics and Paralympics. This includes the IOC (from Switzerland) and national sports associations. No permanent establishment means no French tax, even when the French national law would allow taxation, because tax treaties are stronger than national law and therefore the French income has to be exempted.

It will rarely happen that a foreign entity or self-employed person will have a permanent establishment in France for the 2024 Olympics and Paralympics. However, if it does, then French tax of 25% has to be paid on the profits and a tax credit or exemption must be allowed in the home country to avoid double taxation.

Practical use for employees in Paris 2024

Non-resident employees will fall under Article 15 of the bilateral tax treaty of their home country with France. This means that France can tax the salary when a non-resident employee is working on French territory, while the home country needs to allow a tax exemption or credit so as to the eliminate double taxation.

There is an exception to this general rule for employees who go to work in France for their non‑resident employer. This is mentioned in Article 15(2) of the OECD Model Tax Convention and taken over in every French bilateral tax treaty. The exception applies under three conditions:

  • the work period does not exceed 183 days;
  • the non-resident employer keeps paying the salary; and
  • there is no French permanent establishment of the company to which the salary costs can be allocated.

With this exception many employees can remain under the taxing rules of the country of their employer; for examples, television companies that send their staff to Paris for the Olympics and Paralympics. These postings will normally not exceed the period of six months, so therefore the taxing right for the salary will stay in the home country of the television company.

Practical use for royalties from Paris 2024

Payments for royalties, such as television and other broadcasting rights, will normally only be taxable in the home country of the owner of the copyright under Article 12 of the OECD Model. This means that royalty payments from France should be exempted from French tax, even though France has a source withholding tax of 25% in its national tax law.

Most copyright income from the Olympics and Paralympics will first go to the IOC in Switzerland – not only from France but also from other countries using television, broadcasting and other rights. The IOC will then distribute part of the royalties to the right holders in various countries, such as national associations. In this chain of copyright payments, more than one bilateral tax treaty may be applicable.

Some bilateral tax treaties deviate from the OECD Model, however, and have a low rate of withholding tax of between 5% and 15% in Article 12 for royalties in their tax treaties. The home state of the receiver then has to allow a foreign tax credit to eliminate double taxation. For countries without a bilateral tax treaty with France, the original French withholding tax of 25% will remain in place; however, France has around 100 tax treaties, covering all the bigger countries.

Practical use for sportspersons in Paris 2024

The main international rule is that the income of sports players (and entertainers) needs to be taxed in the state of their work. This is specified in Article 17 OECD Model Income Tax Convention and sets aside the allocation rules for self-employed and companies (Article 7) and for employees (Article 15). This means that no permanent establishment is needed for the source taxation, as required for Article 7, and that no exception is possible for short-period work of employees in the other state, as is normal under Article 15(2).

France is using Article 17 for sports players (and entertainers) in almost every tax treaty. This means that France has the taxing right for all income directly related to the Olympics and Paralympics, for the days that the sports players are staying on French territory. This applies to the payments from national associations, sponsors and others, such as for living expenses and bonuses. It also includes the new bonuses from World Athletic, because these are earned with the sports activities in France. However, the chance is very likely that France will not use this broad taxing right for non-resident sports players for income earned outside France, because it is hard to obtain that information.

This should be no problem, because the residence country of the sports players will tax the income from the Olympics and Paralympics anyhow, as part of the worldwide income. On the other hand, if France taxed the income under Article 17, this would lead to double taxation and so Article 23 OECD Model provides for elimination of double taxation in the residence state, either with the tax exemption or tax credit method.

With the exemption method, the foreign income will be exempted from national tax, while the tax credit method allows the deduction of the foreign tax from the national tax. The exemption method is easiest to apply but might lead to double non‑taxation if France does not levy tax when it has the taxing right under Article 17.

The exemption method can be found in the treaties with the following countries: Argentina (1979); Austria (1993); Belgium (2021); Bolivia (1994); Bulgaria (1987); Cameroon (1976); Gabon (1995); Germany (1959); Hungary (1980); Ireland (1968); Jordan (1984); Kenya (2007); Madagascar (1983); Panama (2011); Slovenia (2004); Switzerland (1966); and Venezuela (1992).

Some tax treaties set as a condition for the tax exemption that the income should effectively be taxed in France. This is the case in the new treaty with Belgium.

Under-taxation cannot happen with the tax credit method and therefore the OECD recommends the use of this method for Article 17 income, which France has taken over in most of its tax treaties.

There is also a risk of over-taxation when France would tax the income from the Olympics and Paralympics and a tax credit or exemption would not be possible in the home country. This happens when the income is paid to another person than the sports player, such as a team or national association.

Then it is not the sports player that is entitled to the elimination of double taxation, but only the other person, who may not have taxable income or can even be tax-exempt (e.g. as a non-profit national sports association). These issues do not apply to sports players from Kuwait, Oman, Qatar and UAE, because France has no Article 17 in these tax treaties.

Also, France is using the exception of Article 17(3) for income from events supported by public funds in 67 of its 100 tax treaties. This means that France does not have the taxing right when the sports activities are supported wholly or mainly (over 50%) by public funds from one or both of the states. This can be applicable to Olympic athletes in relatively unknown sports.


Taxation of the 2024 Paris Olympics and Paralympics is a balance between French national tax law and bilateral tax treaties. Source withholding tax can be set aside by treaty articles, such as Article 7 for companies and self-employed workers, Article 15(2) for employees working for their employers for less than six months in France and Article 12 for royalties. This is only different when there is a permanent establishment in France or employees would be sent for longer than six months to the country.

For non-resident sports players, France has a broad taxing right following Article 17 of the OECD Model, even when the income has been earned outside France, although it is not likely that France will send income tax returns to include that income. This might lead to double non-taxation for sports players from countries with which France has agreed the exemption method in their tax treaty. The tax treaty should be studied as to whether this exemption really will apply.

On the other hand, double or excessive taxation can also happen when France would tax the income and problems arise with the foreign tax credit in the home country of the sports player and the national association.

Article 17 OECD Model can be a major disturber in international sports tournaments and that is again visible this year at the Paris Olympics and Paralympics.


Author biography

Dr. Dick Molenaar is partner with All Arts Tax Advisers and researcher at the Erasmus School of Law in Rotterdam, the Netherlands.