How to maximise Creative Tax Relief

7 March 2020

The words “tax relief” are without doubt music to everyone’s ears but did you know thousands of businesses aren’t making the most of them. What’s more, you could be one of them.

Tax in the Film, Animation, TV, and Video Gaming industries, also known as the Creative Sector, can be complex and mind-bending.

Did you know that your creative business could potentially benefit from Research and Development tax relief? You may also be part of the culture test, which could provide further relief if you meet HMRC’s criteria.

Our goal is to help you identify what tax breaks you qualify for and make sure they are enforced. So to begin, let’s see if you qualify. Please answer “Yes or No” to the following questions (only answer those that are related to your industry):

FILMS

  • Is it intended for theatrical release?
  • Will at least 10% of the total production costs relate to activities in the UK?
  • Did the first day of principal photography take place on or after 1 January 2007?

ANIMATIONS

  • Is the programme intended for broadcast?
  • Is at least 51% of the total core expenditure on animation?
  • Is at least 10% of the total production costs related to activities in the UK?

TELEVISION PROJECTS

  • Is the programme intended for broadcast?
  • Is the programme a drama, comedy or documentary?
  • Is at least 10% of the total production costs related to activities in the UK?
  • Is the average qualifying production costs per hour of production length not less than £1 million per hour?
  • Is the slot length in relation to the programme greater than 30 minutes?

CHILDREN’S TELEVISION PROJECTS

  • Is the programme intended for broadcast?
  • Is the programme for children (specifically the primary audience is expected to be under the age of 15)?
  • Will at least 10% of the total production costs relate to activities in the UK?

VIDEO GAME PROJECTS

  • Is the video game British?
  • Is the video game intended for supply?
  • Is at least 25% of core expenditure incurred on goods or services that are provided from within the European Economic Area (EEA)?

R&D tax relief

  • Are we spending money on creating or improving a process, product or service?
  • Does the project require advance knowledge or clarify uncertainty?
  • Did these projects commence in the last 2-3 years?
  • Do you employ people across a variety of job roles to work on these projects?

Eligible R&D must be:

  • Seeking to achieve an advance in science or technology.
  • Subject to scientific or technological uncertainty.

If you’ve answered “yes” to any of these questions then you may be entitled to tax relief that could uncover hidden cash flow benefits. This, in turn, could benefit your future projects and margins.

Despite answering “no” to the questions above, you may already be entitled to Research & Development Tax relief, it’s important to assess how these reliefs interact and a specialist tax advisor is required to support you through the maze of the various avenues.

Within many UK Limited Companies, research and development activities exist and many accountants and tax advisors often overlook the enhanced tax relief available.

Whether you qualify for FTR (Film Tax Relief), ATR (Animation Tax Relief), HTR (High-end television) relief), CTR (Children’s television relief) or VGTR (Video Games Tax Relief), the Fortus Creative Team can project manage and deliver the whole process.

SO WHAT ARE YOU WAITING FOR?

CONTACT ROB QUINN TODAY ON 020 8138 5560 TO FIND OUT IF YOU QUALIFY.

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