UK Government increase film and tv tax breaks
The UK Spring budget released on 17 March by Chancellor of the Exchequer Jeremy Hunt revealed a happy outcome for the fate of tax breaks in the film and tv sector. After an uneasy period of review, British producers can breath as sigh of relief at the developments which include raised tax credits and ensure the nation’s maintained status as one of the biggest production hubs in the world.
“Our film and TV industry has become Europe’s largest with our creative industries growing at twice the rate of the economy,” stated Hunt to the House of Commons. Reflecting his sentiment, the chancellor announced that the existing television rebate will increase from 25% to 34% in January 2024, also extending to film production. Whilst the qualifying minimum spend threshold in HETV productions will remain at GBP 1 million, the slot length required for eligibility will decrease from 30 minutes to 20. In addition to these shifts, animation and children’s television will have access to a 39% rebate joined by a new video games credit of 34%. Reformed from 1 April 2024, the budget stated that “the new Audio-Visual Expenditure Credit will replace the current film, high-end TV, animation and children’s TV tax reliefs.”
“The news today will ensure the U.K. remains a truly globally competitive production hub, giving us economic recovery and growth, creating thousands of jobs for people up and down the country and enabling creative talent and storytelling to thrive” commented Ben Roberts, chief executive of the British Film Institute. “It’s good news that the high end TV threshold has been preserved. I am particularly heartened to see a much needed boost for children’s television and animation as two areas of cultural and societal importance in which the U.K. excels creatively, but that still have significant growth potential.”
Hunt made mention of the February approved GBP 800 million expansion of Pinewood Studios in Buckinghamshire, which will see the site offering 8,000 new jobs. Making it the biggest studio in the world, the usage by a host of international and local projects is set to inject GBP 640 million a year into the UK economy. Chief Executive of the British Film Commission Adrian Wooton OBE responded to the recently announced budget and dedication to the screen industry with words of gratitude. Whilst understanding that there are still some details to fine tune, he is optimistic of the broad spread of positive impact it will have on the industry and local community alike.
Today’s announcement is a real recognition from the Government of the growth and opportunity our UK Film and High-end TV industry presents,” Wooton stated. “The UK’s tax reliefs have directly influenced many productions’ decisions to base themselves in the UK, contributing billions of pounds to the economy and hundreds of thousands of jobs across the UK’s nations and regions. With increasingly intense international competition, we’re delighted to welcome this package of measures, future-proofing the UK’s film, High-end TV and animation tax credits and our position as a leading global production hub.”
In preparation for the new relief to completely take effect, the current regime will close to new applicants from 1 April 2025 giving way for project that haven’t wrapped by this time access until 31 March 2027. The budget outlined: “The expenditure credits will be available for companies to claim in respect of accounting periods ending on or after 1 January 2024. Productions that have claimed relief under the current system will be able to opt into the new regime.
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