One Comment About Taxation – Foreign Artists Performing in Canada – like AC/DC – Have Significant Tax Hurdles

Hells bells! On August 13, I’ll be in Vancouver for my sixth AC/DC concert. My roots, ironically, are classical – grade 10 piano, grade 6 theory, and a stretch when I thought I’d become a music teacher rather than a tax accountant. But classical music is work for my brain; I can’t read or study with it playing because I end up dissecting the timing and key changes. Classic rock and blues ask nothing of me – three chords, a simple beat, lyrics that are gloriously dumb, the perfect antidote to a day spent reading the Income Tax Act.

 

But old habits die hard, and by the time the house lights go up, part of my brain will drift toward an issue I’ve been thinking about at rock concerts for three decades: how does Canada actually tax a foreign rock band for playing here?

 

Every dollar AC/DC, or Bruce Springsteen, or Taylor Swift, or any other non-resident performer – earns for a Canadian show is caught by Regulation 105 of the Income Tax Act. It requires the payer, typically the promoter, to withhold 15% of any fee paid to a non-resident for services rendered in Canada and remit it to the CRA. Add another 9% for Revenue Québec if the show is in that province. It doesn’t matter whether the “performer” is the headliner or a lighting director flown in from Los Angeles – if they’re a non-resident paid for services performed on Canadian soil, Regulation 105 catches it. Back in black!

 

The withholding isn’t a final tax – it’s a deposit against the actual Canadian liability. Which tax treaty applies depends on who’s actually being paid. Most larger acts tour through loan-out corporations, so the applicable treaty turns on where that entity resides, not where the band started out. Whether that’s Article XVI of the Canada-US treaty, or something else, the mechanism works the same way: it preserves Canada’s right to tax entertainers’ Canadian-source income despite general rules that would otherwise shield a non-resident with no permanent establishment here.

 

That 15% comes off gross Canadian revenue at each stop. Merchandise brings a wrinkle: t-shirts aren’t caught by Regulation 105, but the royalty a band earns licensing its name to a merch company faces a 25% withholding rate. Multiply that across a stadium tour and a touring party of hundreds, and it’s easy to see why entire specialist practices exist to navigate these rules.

 

Money talks – right?! Let’s explore that. None of AC/DC’s actual numbers are public, but let’s take a shot in the dark. The stadiums in Edmonton, Vancouver, Montreal, Toronto and Winnipeg have combined capacity above 260,000. Assume the five Canadian dates run about 90% sold – roughly 235,000 paid fans – at an average ticket price of $180 – that’s a low estimate, trust me – would be close to $42.3 million in gross Canadian box office. Top-tier legacy acts typically command 85% to 90% of net box office once facility fees and taxes are stripped out, which works out to roughly 60% of gross – call it $25.4 million in Canadian-source performance income. Add merchandise – say $25 a head across those 235,000 fans is roughly $5.9 million in gross sales, with perhaps 35% of that – $2.05 million – flowing back as royalty, thus forcing a 25% withholding tax. On that combined $27.45 million, Regulation 105 and the 25% royalty withholding would pull more than $4.3 million before the tour bus leaves the country – that’s a whole lotta Rosie held by the Canada Revenue Agency (“CRA”) against a final tax bill that, once touring costs are deducted, is almost certainly a fraction of that.

 

The recovery requires a T1 or T2 return to be filed under section 115 of the Income Tax Act depending on who was paid. The 25% royalty withholding is a different animal: that’s generally a final tax – there’s no return to file to get it back.

 

Because 15% of gross revenue almost always exceeds a touring act’s real Canadian tax liability once expenses are counted, the system allows for certain waivers. Since 2018, the CRA has offered a simplified process for non-resident artists and athletes earning no more than $15,000 in Canada annually – handy for a support act, useless for AC/DC. Above that threshold, touring artists don’t get the easier path other non-resident service providers can use. Instead, they get thunderstruck.

 

Budget 2024 proposed giving the CRA legislative authority to issue a single waiver covering multiple transactions over a specified period, rather than engagement by engagement – precisely the high voltage a touring act needs. That measure became law through Bill C-15 earlier this year but the CRA hasn’t yet built the process to use it. Separately, the CRA ran its own consultation through summer 2025 and says administrative improvements are coming this year.

 

Angus Young and his advisors have long figured all of this out. But the mid-tier and emerging acts who don’t have a battalion of tax experts can often get shot down in flames by the compliance complexity. The rules aren’t unreasonable in principle – Canada has every right to tax income earned on its soil – but getting relief from over-withholding is disproportionately burdensome relative to the revenue at stake.

 

If Canada wants to be a more attractive stop on a global tour with its related economic benefits, the multi-transaction waiver authority in Bill C-15 is a real step forward. But it will only matter if the CRA implements it with fast turnaround times and clear, published criteria. A touring act, big or small, needs certainty measured in weeks, not months. In other words, the dirty deeds [need to be] done dirt cheap.

 

On August 13, I’ll be keeping a stiff upper lip in Vancouver, trying to forget about Regulation 105 for two hours. Bill C-15 gave the CRA the amplifier – now it’s time to turn it up to 11. For those about to rock – and those about to withhold – we salute you.

 

One Comment About Leadership – Leaders, You Can Learn a Lot About Leadership From Bees

 

This past weekend I pulled our mid-summer harvest from my hobby farm – about ten pounds of honey across three colonies, with one hive performing especially well. Standing over the extractor, watching four frames of capped honey give up an entire summer’s work, it struck me how closely a well-run hive resembles a well-run organization with good leadership – and how obvious it is when either one isn’t.

 

Ten pounds sounds modest until you price out what it cost the hive. By commonly cited beekeeping estimates, one pound of honey represents roughly 2 million flower visits and about 55,000 miles of flight – more than twice around the earth – and takes the entire working lifetime of 500 to 750 worker bees, each living only about six weeks and producing, in that lifetime, barely a twelfth of a teaspoon. Scale that to ten pounds: roughly 20 million flower visits, well over half a million miles flown, and the collective output of several thousand workers who will never see the honey consumed.

 

Nobody directed any of that effort. A hive produces honey because tens of thousands of bees know their job, trust the rest of the colony is doing its job, and orient around one unambiguous signal from the queen. Nobody manages the workflow – the structure manages itself because the signal is clear.

 

When that signal weakens – when the queen’s pheromone fades or the colony loses confidence in her – you don’t get a dramatic collapse. You get something quieter: foragers drift, nurse bees neglect brood, the workforce hedges instead of producing. From the outside, the hive still looks fine. Inside, it’s slowly emptying. I have one hive doing exactly that right now, and I need to sort it out this week.

 

That’s the same failure mode I see in weak leadership, corporate or political. Mark Carney is a case study: all the credentials and technocratic polish anyone could want, and still no clear, consistent signal for the people he leads to organize around. The result isn’t collapse – it’s drift. Businesses hedge instead of invest. Talent disengages instead of quitting outright. It looks like stability. It’s actually attrition.

 

The lesson: leadership’s core job is to produce a signal clear enough that everyone downstream can act on without being told what to do – and to be worthy of the collective effort that follows it. Ten pounds of honey, 20 million flower visits’ worth, says my bees had one. Plenty of organizations right now don’t.

 

 

One Comment About Economics / Politics  – When the Signal is Unclear, Capital Flees or Hoards

 

When Canada’s political leaders send unclear signals, some investment dollars leave outright. The rest behave like drifting foragers – they don’t leave the hive, they just stop moving, waiting for a queen who can tell them where to go. Fix the signal, and production follows.

 

Bonus Comment – Attributed To Colin Powell – Former U.S. General and Statesman- About Leaders Sending the Right Signal

 

“Great leaders are almost always great simplifiers, who can cut through argument, debate and doubt, to offer a solution everybody can understand.”

 

Leaders, are you providing the right signal to your team? Are you sure? How do you know? Are you simplifying your messages?

 

I hope today’s newsletter has been thought-provoking for you.

 

As many of you know, I’m passionate about helping people make better decisions – whether in tax, leadership, or business. If you’d like to go deeper on those topics, my recently released book, Making Life Less Taxing (Version 2), is now available and expands on many of the practical ideas I’ve written about over the years.

 

I’m also putting the finishing touches on my next book, Leadership Compounds: How Small Decisions Build Culture, Credibility, and Legacy. It explores a simple but powerful idea: leadership isn’t about grand gestures – it’s about the small, consistent decisions that compound over time.

 

For those interested in a more hands-on approach, I’ll soon be announcing a bespoke consulting initiative – The Acorn Growth Program – designed to help leaders and organizations grow intentionally, one small (but important) decision at a time. Feel free to reach out to me directly for more information.

 

And if you’re not already on my mailing list, feel free to sign up for my In the Mood Network newsletters to receive more content. No fluff – just practical insights on tax, leadership, and economic policy.

 

Thanks for reading. As always, I welcome your thoughts and feedback.

 

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