Orchestra tax relief (OTR) was announced by the UK government in 2014 and became available from 1 April 2016. Most eligible production companies will be able to claim around 20% of the costs associated with orchestral concerts.

It is essential that any company applying for the orchestra tax rebate is registered with Companies House in the UK and subject to standard corporation tax liabilities. Even loss-making companies can make successful applications for orchestra tax incentives, as losses can be surrendered for cash credits.

Who can claim orchestra tax relief?

Orchestral tax relief is applicable for production companies that:

  • are responsible for organising orchestra concerts from the start to the finish
  • engage or employ the orchestra performers
  • directly negotiate orchestra contracts
  • make creative, artistic or technical contributions to concerts

You can find out more by referring to the orchestra tax relief manual on the gov.uk website.

What is the definition of an orchestral concert?

The principal definition of an orchestral concert is that it is performed mainly or wholly by instrumentalists forming part of a band, orchestra, group or ensemble. It is also important that the instrumentalists are the sole focal point of any concert.

An orchestra should:

  • consist of a minimum of 12 instrumentalists
  • most instruments used should not be amplified in any way
  • have a prime focus on playing to members of the paying public, or have an educational focus

You won’t be able to claim orchestra tax relief if the following circumstances apply:

  • one of the principal reasons for the concert is to promote or advertise any types of goods or services
  • if the concert includes any contest or competition
  • when the main objective of the concert is to make a recording for public broadcast or release. For example, where the recording will be used as a soundtrack for TV or radio broadcasts, or as background for a video game or in a film

Claiming an orchestra tax rebate

When it comes to claiming for orchestra tax relief every single performance is classified as a separate event, but companies can choose to claim for a series of concerts as just one event if they prefer. When this is the case, it’s important to make the election in writing to the HMRC prior to the first concert taking place, and all subsequent concerts need to be specified within the application.

Orchestra tax relief calculated by reference to core expenditure for any concert, or series of concerts. Core expenditure consists of:

  • the expense of producing the concert, or series of concerts
  • any travel to venues that are located away from normal performance venues

Expenses that cannot form part of the claim include:

  • expenses for the actual concert
  • speculative expenses which are not related to the concert performance
  • indirect expenses, such as marketing, storage or legal services.

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