Museums and Galleries Tax Relief (MGTR) was introduced in 2017 as part of Finance Act (No 2) 2017. This tax relief is the most recent enactment to the suite of creative tax reliefs and can be used to support touring and non-touring museums and galleries.
Non touring exhibitions qualify for tax relief at a rate of 20% and touring exhibitions qualify for a rate of 25%, up to a maximum amount of £80,000 for non touring exhibitions and £100,000 for touring exhibitions.
Museums and Galleries Tax Relief Guidance
HMRC has published limited information in relation to Museums and Galleries Tax Relief guidance.
This tax relief is available to qualifying production companies of a primary or secondary nature that can demonstrate:
- responsibility for the production of an exhibition at any venue
- an active role in the decision making
- they pay for all rights, services and goods
- actively directly negotiate contracts
Where a primary production company makes an application, they must also prove they made effective creative, artistic or technical contributions to the exhibition.
Who qualifies for Museums Tax Relief?
The tax relief is available to:
- any primary or secondary production company responsible for the exhibition
- a charity with responsibilities for maintaining or owning a gallery or museum, companies owned by local councils also qualify
The intention from the outset of the exhibition is to be open to the general public. In addition, 25% or more of the core expenditure is to be incurred within the EEA.
Where touring exhibitions from museums and galleries are responsible for the opening venue and then pass on responsibility to other museums and galleries for handling the exhibition. This is how the concept of secondary production company becomes valid and relevant. A primary production company has responsibility for the creation of the exhibition and usually the first venue at which it is displayed. It is also possible that there could, effectively, be more than one secondary production company involved in exhibitions.
What qualifies as an exhibition?
An exhibition is a public display which is curated. The exhibition should consist of organised collections of scientific, artistic, historic or cultural interest. There is no requirement to charge the public an entry fee, furthermore it is possible for one single object to be classed as an exhibition.
Works which do not qualify for relief include:
- exhibitions organised in conjunction with competitions
- where the main purpose of the exhibition is the sale of displayed works
- live performances, unless incidental to the main purpose of the exhibition
- any live displays
- any exhibitions offering items for sale
Touring exhibitions need to meet an additional criteria:
- 25% of the total works exhibited at the first venue are to be displayed at all subsequent venues
- consist of more than one venue
- there should be no more than six months between exhibiting at different venues
- the primary production company will be registered at Companies House and within the remit of corporation tax.