Film Tax Relief (FTR) 

Film Tax Relief commenced on the 1st January 2007 and is available to film production companies within the charge to Corporation Tax.

Subject to the production company and the film meeting the qualifying conditions as set out in the legislation in Finance Act 2006 (see link) and subsequent amendments.  

How does FTR work?

FTR works by enhancing expenditure incurred in the development process and creates an additional deduction to be set against the profit or, where it extends or creates a loss, allows that loss to be surrendered to HMRC for a payable tax credit thus providing the company with either a reduction in their corporation tax liability or a repayable tax credit.

A company will qualify if:

  • It qualifies as the Film Production Company (FPC)

To qualify as the FPC it must:

  • Be incorporated in the UK or have a UK permanent establishment that falls within the charge to UK corporation tax.
  • Be actively engaged in production, planning and decision making during the pre-production, principal photography and postproduction stages of the film
  • Directly negotiate contract and pay for rights, goods and services relating to the film.

A film will qualify if:

Passing the BFI Cultural Test:

The BFI Cultural Test is points-based, with sections relating to content, cultural contribution, location, and cast and crew.

Projects need to achieve at least 18 from a possible 35 points.

The sections are:

  • Cultural content
  • Cultural contribution
  • Cultural hubs
  • Cultural practitioners

For further guidance:

https://www.bfi.org.uk/supporting-uk-film/british-certification-tax-relief/cultural-test-film

Qualifying as an official Co-production:

  • There must be a UK production company responsible for all UK elements of the production from beginning to completion.
  • There must also be corresponding production companies in the other co-producing party countries
  • There must be a co-producer in each country, and an application lodged in each country
  • Films, including those made under official co-production treaties, must reach a minimum UK spend requirement of 10%.

The UK currently has eleven active bilateral treaties. http://www.bfi.org.uk/film-industry/british-certification-tax-relief/co-production

Which expenditure qualifies for enhancement?

Expenditure qualifying for enhancement is called Core expenditure and includes expenditure incurred on:

  • Pre-production
  • Principal photography
  • Post-production

Non-qualifying or non-core expenditure include costs relating to:

  • Development
  • Distribution
  • Other non-production activities

How is FTR claimed?

FTR is claimed through the Company Tax system which means that claims must be made within a Company Tax Return or an amendment to a Company Tax Return.

Claims must include computations in respect of all qualifying productions and detail the income received and the expenditure incurred.

The expenditure should be split between core and non-core and information should be provided of any apportionments used. 

As specialists in Film Tax Relief, we are here to help you achieve the maximum benefit available whilst making the process as simple as possible.

If you would like to download our free fact sheet on Film Tax Relief - sign up here.

Testimonials

"I am so pleased and relieved that Graham got in touch with me about Theatre Tax Relief. I had mistakenly thought that we were not eligible but so far Graham has claimed nearly £100,000 in tax credit for us. This is not only an enormous benefit and can be ploughed back into the work that we do but it would have been extremely short-sighted of us not to be claiming the money that is due to us. Graham has made the whole process so simple and easy. I cannot recommend him highly enough"
Sarah Gobran, Co-Founder & Producer of The Guildford Shakespeare Company
"NCO engaged Graham at the start of 2019 and has developed a wholly positive and ongoing relationship ever since. Not only has Graham increased our understanding of OTR and how it applies to NCO, he has taken all the stress and strain away from the process. His previous experience as a tax specialist at HMRC has proved invaluable as has his ability to explain the complexities to us in a way we can understand! I cannot recommend Graham more highly. "
Sophie Lewis, Managing Director of the National Children's Orchestras of Great Britain
"Graham explained very clearly what was needed and then delivered exactly as he said he would. Graham prepared the computations and submitted the claims on our behalf and we didn't have to deal with HMRC at all. This was the easiest piece of tax work that we have ever had to do"
Matthew Quirk of The Merry Opera Company
"Our accountant struggled with VGTR so we engaged Graham and his company. Graham prepared all the necessary computations and submitted the claim on our behalf. This was paid by HMRC without question and in an amount in excess of what we had previously expected. We are delighted and cannot recommend Graham or his company highly enough"
Ashley Stancill, Director at HyperSloth Games
"With no clear guidance on how to claim Theatre Tax Relief and after spending a considerable amount of time consulting with colleagues, accountants, reading huge, incomprehensible HMRC guidelines and generally worrying that the company was missing the TTR boat, I spoke to Graham. Everything was plain sailing for us after the initial consultation – with very little effort on our part, Graham made a successful submission and we have just received a substantial payment. I am delighted at the outcome and have no hesitation in recommending Graham and his company"
Sue Andrews, former Executive Director of Northern Broadsides Theatre Company
"I have been aware of Theatre Tax Relief for a few years now but the process of claiming the money was daunting. We didn't have the resources or the expertise to make the claim. Graham made the process of claiming Theatre Tax Relief very straight forward. He kept me informed of developments and answered all my questions. I provided him with information and he did the rest"
Shona Rattray, General Manager of the Hopscotch Theatre Company
"For a small theatre company like us navigating Theatre Tax Relief was a daunting prospect. Having the support and expertise of Creative Tax Reliefs was absolutely brilliant. Graham explained everything and did a fantastic job sorting out the different projects we had been working on, calculated what we could claim and did all the leg work. The Tax Relief we received from HMRC helped us take our show to the Edinburgh Fringe, something we certainly couldn't have done without this extra funding. We would highly recommend Creative Tax Reliefs and will certainly be using them again in the future. "
Jasmine Cole of Jasmine Cole Productions
"When I first heard from Graham I have to say I was more than a little sceptical. Why had no one mentioned this to us before? The information seemed so monumental – shouldn’t it have been on the news? Within a few emails and phone conversations, we had provided all the information necessary and had everything thoroughly explained to us. Within two weeks we had received the tax credit into our bank account! Creative Tax Reliefs are amazing!"
Clare Molyneux, Artistic Director of Open The Door (Theatre in Education) C.I.C.
"When Graham first contacted us, we hadn’t heard of Theatre Tax Relief, which made us fairly wary. Graham took the time and care to explain it all to us and how the process would work. Initially, we were sceptical and worried about the time it would take for us to collate all the information needed for the claim. However, we needn’t have worried, Graham helped us every step of the way and made the process simple and quick. We would recommend working with Graham in an instant."
Fliss Green, Senior Strategy & Project Manager of Chain Reaction Theatre Company
"It was a pleasure to work with Graham. He explained the process very clearly, prepared all the necessary computations and submitted the claims on our behalf. We are extremely delighted with the outcome and have no hesitation whatsoever in recommending Graham and his Company to others"
Sylvia Collins of the Huddersfield Light Opera Company

CREATIVE TAX RELIEF UPDATES

 


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