Bingo and booze may have grabbed the headlines, but yesterday’s Budget also gave the film industry a boost.
The Chancellor confirmed that changes to Film Tax Relief have been approved.
The Tax relief will provide a 25% payable credit on the first £20m of qualifying production expenditure and 20% thereafter, this is for small and large budget films which incur a loss.
It also states that the minimum UK expenditure requirement will be reduced from 25% to 10% to encourage more producers to invest in the UK. This reduction will be of particular note to visual effects and post production companies. It could also encourage more co-productions.
“Like many other industries competing in global markets, the UK’s film production industry has been campaigning for more support in terms of tax relief to allow it to compete against lower cost locations. The confirmation of these changes to the existing tax incentives will encourage more productions to me made here. It’s good news for film. The Government has put its weight behind film and see it as an area of growth – an industry that performs well both in terms of export and inward investment,” explained Ian Rowland, the northern head of the tax innovation group at Grant Thornton.
“The changes will make the Film Tax Relief easier to use and more attractive, as well as eradicate the ‘cliff edge’ between the 20% and 25% rates which depend upon the size of the film’s budget. Reducing the minimum UK expenditure requirement to 10% will encourage further investment in the UK and support a wider base of film companies to qualify.”
The changes come into effect on April 1st.