Film Tax Relief

Companies in the UK that produce films (including television and video productions) are subject to special tax rules which determine how the taxable profits of the film-making activities are to be calculated and how any losses may be applied.

Film Tax Relief is available to those engaged in the making of a British film that is intended for theatrical release, and on which at least 10% of core expenditure is incurred on goods or services used or consumed in the United Kingdom.

Both the additional deduction and the payable credit are calculated on the basis of UK core expenditure (that is expenditure on pre-production, principal photography and post-production) up to a maximum of 80% of the total core expenditure,

The levels of the additional deduction and payable credit are dependent of the size of the film’s budget. For a limited-budget film (one whose core expenditure is £20 million or less) the additional deduction is 100% of qualifying core expenditure and the payable tax credit is 25% of losses surrendered. For other films, the rates are 80% and 20%.

FTR is available to films that:

  • commenced principal photography on or after 1 January 2007; or
  • commenced principal photography before 1 January 2007, but were still uncompleted.