Tax relief for high end TV overtakes film tax relief for the first time

Tax relief for high end TV overtakes film tax relief for the first time

Tax relief paid out to qualifying companies making high-end TV programmes jumped by 131% in the tax year ending March 2022 amid substantial growth in the sector, according to new figures released by HMRC today.

In total, 380 production companies submitted 475 claims for high end TV tax relief in 2021-22, claiming £829m in tax relief. This compares to the 295 companies that submitted 355 claims in 2020-21 with claims totalling £358m.

This is the first time that the amount paid out in relief for high end TV has overtaken the amounts claimed for film tax relief. The figures reflect the significant investment from streaming services in series like Bridgerton and Ted Lasso which were filmed in the UK.

There was a modest growth in the number of claims for film tax relief in 2021-22 which were up 4% year-on-year. However, the amount paid out in relief totalled £517m, up 25% versus the previous year, suggesting that bigger budget films benefitted from film tax relief during the year.

Recent movies that have been filmed partly in the UK include Barbie and Mission Impossible, indicating that the UK remains an attractive location for international film production.

The new figures also showed a surprising drop in the amount of tax relief claimed by video games companies. After six years of consecutive rises, there was a 6% drop in the amount of relief claimed under the video games tax relief regime. This was due to a drop in high-value claims, although this was partly offset by an increase in smaller claims.

Other creative industry reliefs for theatres, orchestras and museums and galleries also showed year-on-year rises as activity stepped up post-pandemic. However, the amounts paid out for these reliefs have yet to bounce back to pre-pandemic levels.

Commenting on the new figures, Vikki Watts, a tax director from BDO commented:

“These tax reliefs for the creative industries are key to attracting investment into the UK and right now they are also crucial in helping these industries to bounce back from Covid.

“The significant increase we’ve seen in the amounts of tax relief paid out for high end TV claims suggests that the UK has done very well out of the huge investments being made by the streaming services into high end TV production.

“It’s also really encouraging to see an uplift in the relief paid out to theatres, orchestras and museums, albeit that live venues were still operating under restrictions during some of the period.

“At the Spring budget, the Government announced that the temporary higher rates for theatre, orchestra, and museums and galleries tax reliefs would be extended for two further years from April 2023, giving the UK’s cultural institutions more time to recover from Covid. Live venues would be well advised to review their opportunities to make claims, particularly where theatres can benefit from these increased rates.

“Meanwhile, reliefs for film, TV and video games tax reliefs are to be reformed to become refundable expenditure credits. It remains to be seen what impact this will have on the UK’s ability to attract investment.

“New changes are also being consulted on which are likely to make it more complicated for companies claiming relief. Companies claiming creative tax reliefs will be required to complete and submit an online information form, similar to the form now required to support R&D tax relief claims, a measure designed to reduce claim errors and prevent abuse.”


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Frank Shepherd
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