PLR Payment and Income Tax -
Useful Information for Recipients
Each February, payments are issued to more than 17,000 individuals registered for compensation with the Public Lending Right Program. In order to provide some basic information to program registrants concerning the treatment of these payments by the Canada Revenue Agency (CRA), we have prepared the following overview:
The Public Lending Right Program operates under the Canada Council for the Arts as a form of discretionary cultural support to eligible individual creators of literary and scholarly work that is found in public library collections.
In the Canadian context, PLR is not attached to copyright legislation, and revenues received are not considered to be royalties by the federal government. The CRA classifies PLR payments as revenue derived from professional services for the purpose of income tax, and therefore taxable income. The Canada Council for the Arts is required to provide a record of payment to PLR recipients and to the federal government. If you are required by law to file a separate provincial tax return, we recommend that you consult the provincial authority for guidance on how to declare PLR income.
The Public Lending Right Program will issue a printed T4A “Statement of Pension, Retirement, Annuity and Other Income” slip for PLR payments of $500 or higher; if you had received $500 or more in 2020, the slip will be included with your 2021 PLR mailing.
Regardless of whether a T4A “Statement of Pension, Retirement, Annuity and Other Income” slip is issued, taxpayers are nevertheless required to include in their income all PLR payments received. If your 2020 PLR payment was less than $500, the amount will be stated on your annual Registration Summary document included with this year’s PLR mailing, for your convenience. Remember that the amount noted corresponds to the amount of payment received in the prior year, in this case 2020. It is your responsibility to include this amount with your tax return.
PLR payments are subject to the eligibility criteria established by the program’s advisory board, known as the Public Lending Right Commission, and are not transferable to an estate or agency during the active span of a claim, nor following the death of the individual registrant, unlike royalty payments or rights-based compensation such as Access Copyright monies.
Income Tax Return
PLR payments are not subject to HST/GST.
The CRA has not provided further specific guidance on reporting the PLR income other than stating that it should be reported on Line 130 of the standard income tax return.
Should you wish to include such income in your Business Income (Line 162/135) please note that you may receive a request for more information from CRA. CRA may look for PLR revenue to be included on Line 130. You will therefore need to provide details of your business income that will show the revenue from PLR included there.
For any further questions and to obtain answers specific to your tax situation, please contact the CRA at 1‑800‑959‑8281.