Film Tax Relief (FTR)

FTR was the first of the creative industry tax reliefs introduced from January 2007. The reliefs were extended to the other creative sectors including Animation, High-end television, Children’s television, Video games, Theatre, Orchestra and Museums and Galleries.

 

Company Eligibility

 

To be qualifying, both the company and the film will need to meet some conditions.

 

The company must be a Film Production Company (FPC). To qualify as a FPC the company must:

• be liable to UK corporation tax;

• be activity engaged in planning and decision-making and be responsible for pre-production, principal photography and the post-production of the film;

• be responsible for delivery of the completed film; and

• directly negotiate contracts and pay for rights, goods and services in relation to the film

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Film Eligibility

 

To qualify, the film must:

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• be intended for theatrical release

• be ‘British’ or qualify as an official co-production

• have had the first day of principal photography on, or after 1 January 2007

• 10% of the total production costs must be in the UK

 

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Cultural Test

 

The film must be classed as ‘British’ by the British Film Institute (BFI). The BFI has a Cultural Test which is points-based based on content, cultural contributions, location and the cast and crew. To be qualifying, the film needs to achieve at least 18 from a possible 35 points.

 

The cultural test comprises four sections:

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1. cultural content (up to 18 points)

2. cultural contribution (up to 4 points)

3. cultural hubs (up to 5 points)

4. cultural practitioners (up to 8 points)

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Additional guidance is available from the BFI available from this link

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Qualifying Expenditure

 

The all important spend that can be enhanced is core expenditure as:

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• pre-production;

• principal photography; and

• post production.

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All other costs would be considered non-qualifying or non-core expenditure.

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