Creative Industry “British” Tax Reliefs
There are lots of creative industry businesses clustered around Manchester, which can secure significant benefit from these new reliefs.
The new tax reliefs for “High-End Television”, Animation and Video Games are effectively an extension of the British Film Tax Relief which has been available for several years. They are available for programmes intended for broadcast to the general public, or games on general release. They are all subject to a “cultural test” which requires them to be “British” – although there are several criteria in the test with a broader European aspect.
What is the relief?
(1) An increased tax deduction of up to 100% of “qualifying UK core expenditure” reducing taxable profits
(2) If there is a loss then some or all of the qualifying expenditure can be “surrendered” in exchange for those losses at a very favourable 25%
The two can be combined for best effect.
WHAT PROJECTS ARE ELIGIBLE FOR CREATIVE BUSINESSES?
(1) High-End Television – drama, documentary of at least 30 minutes’ “slot length”, averaging at least £1 million core expenditure per hour, and for broadcast to the general public.
There are several excluded programme categories, including news/current affairs, competitions, entertainment, (chat shows, game shows or similar), live performance, advertising or training programmes.
“Core Expenditure” here means production expenditure on pre-production, principal photography and post-production of the programme.
(2) Animation is essentially similar to high-end television, except that the programme doesn’t have to fill a 30-minute slot, nor hit the “£1 million per hour” mark for core expenditure.
(3) Video Games (including the sound track) *NB Currently Under Review by the European Commission*
For video games, “Core Expenditure” relates to designing, producing and testing the game but not the initial concept or debugging/maintenance.
- “UK expenditure” is that on goods or services used or consumed in the UK. At least 25% of the core expenditure must be in the UK
- There can normally be only one eligible company per project but co-productions may be able to claim.
- Companies may also be eligible for Research and Development tax reliefs but care is needed.
GET IN TOUCH If you think this relief could benefit you – firstname.lastname@example.org