Children’s television is an important part of the UK creative economy. Because of this, in 2015, the government introduced a special tax relief scheme for producers of children’s television. The Children’s Television Tax Relief (CTR) is one of eight creative industry reliefs and builds on the High-End Television Relief and Animation Relief.
Children’s Tax Relief aims to assist UK-based production of children’s TV by providing a financial boost. Like all of the creative tax reliefs, the CTR offers a cash benefit provided your production meets certain criteria.
Who can claim Children’s Television Tax Relief?
Children’s TV Tax Relief can be claimed by companies producing children’s television programmes. As with other creative tax reliefs, CTR can only be claimed by a company that is subject to corporation tax.
The production itself must meet certain criteria. The requirements are similar to those of the ATR and HTR. Programmes must be intended for broadcast and either pass the cultural test or qualify as a co-production. At least 10% of the production costs must be from activities in the UK.
Additionally, it must be a programme for children where the primary audience is expected to be under 15 years old. Programmes that are commissioned together are treated as a single programme under the guidelines for claiming CTR.
While HTR is subject to a £1 million per programme hour threshold and a 30-minute slot length requirement, Children’s TV Tax Relief is not. Like the lower thresholds for CTR reflect the different formats and types of production made for the younger audience.
The CTR also has certain allowances for quiz and game shows, provided the prize is not above £1,000.
Who can’t claim?
As with all of the cultural industries tax reliefs, certain productions are not eligible for CTR claims. These include
- advertisements or promotional programmes,
- news or current affairs programmes,
- panel or variety shows,
- live events, including theatrical performances,
- programmes produced for training purposes.
BFI cultural test certification must be received before the claim can be made. An experienced CTR adviser can help producers understand the timeline for filing and how the BFI cultural test applies.
What costs qualify?
The costs incurred are the basis of any CTR claim, and this means that accurate record keeping is essential for a successful claim. Like HTR and ATR claims, relief is claimed on core expenditure in the UK. This may include pre-production, post-production, and intellectual property rights costs. An experienced CTR tax adviser can help determine which expenditures are eligible for a claim, as requirements may change.
Provided all criteria are met, companies can claim whether or not a production is profitable. This could be an additional deduction of 100% of the enhanceable expenditure or, if a loss has been made, 25% of the loss up to the amount of the enhanceable expenditure. A tax adviser can help determine what deduction might be available for a given production.
A worked example of Children’s TV Tax Credit can be found <here>