Teosto and Gramex for bands: two royalties many leave unclaimed

Teosto and Gramex are two different Finnish collecting societies that collect two different royalties. In short: Teosto pays for writing the song; Gramex pays for playing or singing on the recording. If you write your own songs and make recordings, both belong to you – but many bands leave one unclaimed.

This guide explains the difference, shows how to register your songs and report your gigs and recordings, and how you get paid. Royalties for your own songs are often exactly the money left uncollected when the reports go unfiled. This is orienting information – rules and fees change, so check the current details on the Teosto and Gramex sites.

The difference is what the royalty relates to: the work (the song: the music and lyrics) or the recording (a released recording of that song).

The same person can be both: if you write a song yourself and play it on your own record, you get a Teosto royalty as the writer and a Gramex royalty as the performer. When your band's recording plays on the radio, Teosto pays the song's writers and Gramex those who played on the record – two different royalties from the same play.

Teosto collects a royalty when a song is performed in public: live gigs, radio and TV, streaming, and background music in restaurants and shops. Getting paid for your own songs requires two things:

• Registering the work – you register the song with Teosto. This is a prerequisite for royalties: without registration the song isn't in the collecting societies' database and nothing is paid. The work gets an international ISWC code. Register the work as soon as it's finished, at the latest before release.
• A performance report – you report your gigs in Teosto's online service so live royalties are allocated correctly.

Joining Teosto requires a one-off joining fee (€125.50 for an individual, including VAT); there are no annual fees. On joining you authorise Teosto to manage your works' rights – you can also choose to manage some uses yourself.

A performance report needs the setlist, the venue and the date – the same details KIERTUE already stores for every gig, with the songs' durations. When the show is over, the report's details are ready, and you don't leave the royalty unclaimed because of a forgotten setlist. Performance royalties from gigs abroad are covered separately in the article on performance royalties from abroad.

Gramex pays when your band's released recording is played in public: radio, TV, streaming, and background music in restaurants, shops and at events. The royalty is split between the performers who played on the recording and the recording's producer (the financial backer or record company).

• Joining is free – you can join if you're an artist, player, singer or conductor and your performance is on a recording.
• A recording report is filed after the recording's release. It's the producer's responsibility, but if they don't file it, you can do it yourself – otherwise the royalties won't reach the right performers.
• Royalties are paid four times a year, and can be claimed retroactively for about three years – a late report is still worth filing.

If your band has its own songs and released recordings, it pays to be a customer of both Teosto (as writers) and Gramex (as performers). They are different royalties from different societies:

• Teosto pays for writing the song.
• Gramex pays for playing or singing on the recording.

Many leave Gramex unclaimed, because it's thought of as just a record-company matter. As joining Gramex is free, skipping it is a straight loss if you have a released recording that gets played in public.

When a song is recorded and reproduced (making the recording, a CD, a streaming master), it's a matter of mechanical rights. These are managed by the Nordic NCB, and the royalty is paid to writers and publishers through Teosto. In practice, if you record your own songs as a self-release, this is a light step; recording music represented by others requires a recording licence.

Teosto and Gramex royalties are earned income and are paid according to the tax card. They are not subject to VAT. The royalties can also be routed to your own company, in which case they are the company's income. The details of taxation are covered in the article on gig income tax.

• The work isn't registered – no royalties are paid for your own songs, because they aren't registered. The most common mistake.
• Gigs aren't reported – live performance royalties go uncollected.
• Not joining Gramex as a performer, even though recordings are played in public – joining is free, so it's a pure loss.
• Teosto and Gramex are confused – one is thought to cover everything, and the other's royalty goes unclaimed.
• The recording report isn't filed – the producer is assumed to have done it when they didn't.

Teosto pays the song's writer, Gramex the recording's performer – two different royalties. If you write your own songs and record, join both: joining Teosto requires a one-off fee, Gramex is free. Register your songs (a prerequisite for royalties), report your gigs and recordings, and the royalties are allocated correctly. Many leave these undone and lose money. Check the current rules and fees on the Teosto and Gramex sites.