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Markel Tax

10 Oct 2018

Creative industries tax relief prompts record spending in UK film and TV

The British Film Industry (‘BFI’) has released a report outlining how screen sector tax reliefs are helping to power economic growth across the UK. 
The tax reliefs in the BFI report today cover a range of activities in the film and television industry and have benefitted 2,420 films, 310 high-end TV programmes, 480 video game productions, 145 animation productions and 75 children’s TV programmes. Some key highlights of the report include:
  • Since the introduction of film tax relief in 2007, UK production spend on film has increased to a new high of £1.72 billion in 2016, with an overall growth rate over the last four years of 47%.
High-end television
  • The high-end television sector (covering episodes with a budget of over £1m per episode) has also seen a huge increase in UK production with expenditure more than doubling between 2013 and 2016. This category includes programmes such as Cold Feet, Black Mirror and Grantchester. 
Video games
  • The UK video games sector provides a key role in the entertainment industry and there have recently been a number of a worldwide hits produced in the UK including series such as Grand Theft Auto, Forza Horizon and Monument Valley. Grand Theft Auto, produced by Rockstar in Edinburgh, is the highest-grossing entertainment series of all time with sales of more than US$6 billion worldwide. 
  • The industry continues to grow, and produces leading global technologies and content, including in innovative and emerging areas such as artificial intelligence, virtual reality, augmented reality, and eSports. 
  • The total spend in this sector (in 2016) was £1.25 billion but less than a quarter of the expenditure went through a Video Games Tax Relief claim meaning that there is millions of pounds of relief left unclaimed. 
Animation productions
  • Covering such well-known names as Peppa Pig, Bob the Builder and Postman Pat the animation tax relief reached just over £97 million in 2016 (an increase of over 27% since its introduction in 2013. 
Children’s TV programmes
  • Children’s television relief is the most recent of the creative industry tax reliefs, having been launched in 2016. Expenditure of around £61 million went through a children’s television relief claim in 2016 and Children’s television relief supported £61 million of production investment.
Creative industry infrastructure
The BFI report also identifies significant investment in studios and facilities with over £850 million publicly identified spend ongoing in the UK in sites such as Church Fenton, Yorkshire; Pentland in Scotland and Wolf near Cardiff. This expenditure may qualify for capital allowances and an expert surveyor and tax team, such as those at Markel Tax can help to maximise the claim.
Whilst the report outlines the tax reliefs available to productions which must meet the BFI’s cultural test, there are tax reliefs available to other creative industry sectors, including theatres, orchestras, museums and galleries which have not been included in the statistics. The tax reliefs available here are just as valuable and available to companies across the UK.
At Markel Tax we have experience and knowledge of working with clients from the creative sector and have helped companies across the production chain to claim these valuable reliefs. Whether it is helping a post-production video editing company to claim R&D tax relief for their work on novel ways to share and store huge quantities of HD film, or helping a video game developer through the BFI cultural test for Video Games Tax Relief, we can help. For more information please contact Neil Bowden on 0114 236 4457.
Tagged R&D tax relief
Next article in series

27 Sep 2018

IR35 in the private sector: Still more questions than answers

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