Creative Industry Tax Reliefs Support Oscars Winner
‘Parasite’ may have been the highlight of the 2020 Oscars, but tax relief in the creative industries has become a talking point here in the UK.
HMRC was quick to announce that one of the night’s biggest winners, Sam Mendes’ war epic ‘1917’, was supported in part with creative tax reliefs. Thousands more have benefitted from the same UK reliefs over the past decade, so it’s worth knowing what you can access if you work in the creative industries.
Creative tax reliefs make a difference
According to the British Film Institute (BFI), more than £3.6bn was spent on film and high-end TV production in 2019: a record amount.
Current tax reliefs in the creative industry date back to 2007. Since they were introduced, more than 5,000 claimants have benefited. Interestingly, BFI research suggests that every £1 granted in tax relief in the industry has generated more than £7 for the UK economy.
Creative tax reliefs have been available for a while, but we expect more professionals in the industry to inquire about their options after the success of ‘1917’.
Pippa Harris, a producer on ‘1917’, said: ‘The UK film and high-end TV tax reliefs have been absolutely crucial [both] in terms of supporting the UK production industry. On ‘1917’ alone, we were able to give employment to over 1,200 crew and more than 1,000 cast, stunt performers and supporting artists.
Other well-known beneficiaries include Aardman Studio, the creators of ‘Wallace and Gromit’ and ‘Shaun the Sheep’.
8 creative tax reliefs
There are eight different British creative reliefs that are available, which fund everything from orchestras to museums. A specialist team at HMRC monitors these reliefs closely to ensure they are operating correctly, and rules are being met. Each relief comes with its own set of eligibility criteria. Here’s an outline of what’s available:
Film and TV Relief (FTR) – films must either meet cultural criteria or qualify as a co-production under the same test conditions. At least 10% of costs must relate to activities based in the UK and the film or TV production must be intended for theatre or broadcast.
Animation Tax Relief (ATR) – again, your work must meet cultural test criteria and be intended for broadcast.
High-end Television Tax Relief (HTR) – your work must be a drama, comedy or documentary with a running time of at least 30 minutes, and 10% of costs must relate to activities based in the UK.
Children’s Television Tax Relief (CTR) – your primary audience must be 15 years or younger. CTR is not subject to the £1 million per programme hour threshold and the 30-minute running time.
Video Games Tax Relief (VGTR) – aimed at British qualifying games intended for supply, with at least 25% of core expenditure provided from within the European Economic Area (EEA).
Theatre Tax Relief – theatre production companies are not required to meet cultural tests; however, their work must be played before a live audience of paying members or the general public, or the production is intended for educational purposes.
Orchestra Tax Relief – again, at least 25% of core expenditure must be provided from within the EEA. A minimum of 12 instrumentalists must perform in the orchestra, ensemble, group or brand.
Museums and galleries exhibition tax relief (MGETR) – surprisingly, museums and galleries are not required to pass a cultural test to claim tax relief, but your work must be considered to be scientific, historic, artistic or cultural interest. The relief has been available from 1 April 2017.
your next creative project
Cardens has used these same tax reliefs to provide financial planning opportunities for our clients. It doesn’t matter if you’re developing a creative passion or walking the red carpet, you too could benefit from the following tax breaks. Get in touch on 01273 739592 or book your free consultation.
If you’re in the process of making a claim, you can contact the Creative Industries Unit to discuss your case.