The Chancellor, George Osborne, announced further support for the creative industries on Wednesday in this year’s Budget, by, among other things, expanding TV and film tax credits, committing financial support to the video games industry and introducing a new tax relief for orchestras.
The announcement has been welcomed by the UK creative industries. John McVay, chief executive of PACT, said that the Chancellor had “really got” the importance of the UK creative industries and the value of tax breaks, and hailed the introduction of the new tax break for children’s TV as “obviously fantastic”. He also said that the changes to the TV and film tax relief “will be very, very helpful to attracting and sustaining growth in the UK”.
Summary of key changes:
The government will increase the rate of film tax relief to 25% for all qualifying core expenditure, for all eligible film productions and remove the current distinction between limited-budget films and all others (from 1 April 2015).
The government will introduce a reduction in minimum UK expenditure requirements for high-end television tax relief from 25% to 10% from 1 April 2015.
The government will also modernise the cultural test for high-end television tax relief for expenditure incurred from 1 April 2015, to match the test for film, which was modernised last year.
Children’s tax relief, currently 25% on qualifying production spend, will be extended beyond animation and live-action programming to include gameshows/competitions from 1 April 2015.
The government will introduce a reduction in minimum UK expenditure requirements for animation tax relief from 25% to 10%.
A new tax relief of 25% on qualifying expenditure for orchestras will be introduced in April 2016.
£4 million will be committed by the government to a new Video Games Prototype Fund designed to target games development talent.
Skills Investment Fund
The fund will be extended for a further two years, and the government will commit a further £4 million to provide match funding for training and development in film, TV, visual effects, video games and animation.