Neighboring Rights Royalty Calculator

Neighboring rights are royalties paid for the public performance or broadcast of sound recordings, such as when a song is played on the radio, in a store, or on TV. These differ from publishing royalties, which are earned by songwriters and publishers for the composition itself. Neighboring rights specifically pertain to the performers and producers of the sound recording, making them a separate revenue stream for artists and labels.

Aggregator fees are deducted as a percentage of your gross neighboring rights royalties and can vary depending on the aggregator's services and reputation. A reasonable fee typically ranges between 10-25%, with lower percentages often available for high-earning artists or labels. While aggregators provide valuable services like collecting royalties from multiple territories and ensuring compliance with local regulations, it's important to evaluate whether their fee aligns with the value they provide.

International withholding taxes are deductions imposed by some countries on royalties paid to foreign artists or rights holders. The percentage can vary by country and is often influenced by tax treaties. To minimise the impact, you can check if your home country has a tax treaty with the source country. These treaties may allow you to claim a reduced tax rate or even exemption. Working with a tax advisor or aggregator familiar with international tax regulations can help you navigate this process and reclaim overpaid taxes if applicable.

Accurate airplay data ensures that all eligible performances of your recordings are accounted for when calculating neighboring rights royalties. Missing or incomplete data can result in unclaimed royalties, especially in international markets where monitoring systems may vary. To maximise your earnings, ensure your aggregator or collection society uses reliable tracking systems and that your recordings are properly registered with all relevant organisations worldwide.

A common misconception is that neighboring rights royalties are automatically collected without any effort from the artist or label. In reality, you must register your recordings with collection societies or aggregators in each relevant territory. Another misconception is that all countries have the same rules for neighboring rights, but laws and royalty rates vary significantly. To avoid these pitfalls, work with an experienced aggregator, stay informed about regional regulations, and ensure your recordings are properly registered globally.

Neighboring rights regulations differ by country, impacting how royalties are calculated and distributed. For example, some countries, like the United States, do not pay neighboring rights for terrestrial radio broadcasts, while others, such as the UK or Germany, do. Additionally, the percentage of royalties allocated to performers versus producers can vary. Understanding these regional differences is crucial for accurately estimating your earnings and selecting the right aggregator to handle collections in specific territories.

To optimise your neighboring rights income, start by ensuring your recordings are registered with all relevant collection societies and aggregators in key territories. Regularly review your aggregator's performance and fee structure to ensure you're getting the best deal. Explore tax treaties to reduce withholding taxes and reclaim overpaid taxes where possible. Additionally, re-evaluate your strategy annually as your music gains traction in new markets to ensure you're maximising your global earnings potential.

When evaluating a neighboring rights aggregator, consider factors such as their reputation, fee structure, transparency, and the territories they cover. Look for an aggregator with a strong track record of timely and accurate collections, as well as expertise in navigating complex international regulations. Ask whether they provide detailed reporting on earnings and deductions, and ensure they have the capacity to handle your specific catalog size and market reach. Reading reviews and seeking recommendations from industry peers can also help you make an informed decision.