As anyone involved in the creative industries will know, filming is an expensive business. However, there is help at hand for those in the professional film business, through the government’s film tax relief initiative.

Film tax relief (FTR) can save your business a significant sum of money.  Applicaitons can be made regardless of the size of your overall budget, even small productions can benefit.

What is Film Tax Relief?

Film tax relief is part of a relief scheme by the British government for the creative industries.  The relief is aimed at helping to ease the cost of filming for many professional entities making films, TV shows or video games for British consumption.

How much can I save?

All British film production companies that qualify for film tax relief can claim a tax rebate of up to 25% of their qualifying expenses incurred in the UK.

The amount of tax relief that your company is awarded is capped at 80% of your core expenditure.

A Film Tax Relief Example calculation can be found <here>

How do film tax credits work?

For both independent and co-productions, your company must be able to prove that the end result of filming will be a British film by passing the UK Film Tax Credit Cultural Test.

Cultural tests are carried out by the BFI for the Department of Culture, Media and Sport.  Qualifying businesses will be given a certificate that can be used to verify eligibility for film tax relief. If your film is in progress, you will be issued an interim certificate, which can also be used to claim interim relief.

When applying for film tax relief, the production company must be able to prove that

  • at least 10% of the total costs of production are for filming expenditure incurred in the United Kingdom and
  • that the film is also intended for release in the UK
  • the first official day of filming also must not have taken place before the 1st January 2007.

How can I apply for film tax relief?

Once your company has been verified by the BFI cultural test, you can claim film tax relief. The total amount of relief calculated will then be rebated back to your company.

It is important to remember that, if you have received an interim certificate, you will need to apply for the full certificate once the film has been finished. Final certificates need to be submitted to HMRC.  Failure to provide final certificates will mean you have to pay back any interim tax rebates that you have received.

If you would like any specific or further information about film tax relief, please contact us today.

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