Film tax relief

Companies 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.

These rules apply to all film production companies whether or not they are producing films intended for release in the cinema.

Some films are eligible for film tax relief. This relief can increase the amount of expenditure that is allowable as a deduction for tax purposes or can be surrendered for a payable tax credit.

The films that qualify for the relief are British films that are intended to be shown commercially in cinemas and of whose total production costs at least 25 per cent relate to activities in the UK.

Whether a film is British for these purposes is determined by a cultural test administered by the Department for Culture Media and Sport, or by virtue of an internationally agreed co-production treaty.

These rules apply to films which commenced principal photography on or after 1 January 2007 and to films starting principal photography before 1 January 2007, but uncompleted then.
Detailed guidance on the taxation of film production companies and film tax relief are available in the Film Production Company Manual.

Manchester Film Tax Credit Unit

There is a specialist unit to deal with most claims for Film Tax Relief (FTR). The Manchester Film Tax Credit Unit will deal with the corporation tax affairs of most companies eligible for FTR and will be able to answer queries about the taxation of film production companies and film tax relief.

The main exceptions to this are cases that are being dealt with by Large Business Service (mainly those which are part of larger groups) which will continue to be dealt with there.

Companies only making films not entitled to FTR will continue to be dealt with by their existing offices.

The address of the Unit is:
Manchester Film Tax Credit Unit
Albert Bridge House
1 Bridge Street
Manchester
M60 9AF

Tel: 0161 288 6310

Email: Manchester Film Tax Credit Unit

UK Film Council

The Secretary of State for Culture, Media and Sport certifies films as British on the advice of the UK Film Council, and any enquiries concerning certification should be directed to:

Certification Unit
UK Film Council
10 Little Portland Street
London W1W 7JG

Tel 020 7861 7525
Email: Film Council

Earlier reliefs

Relief for film production was previously provided by sections 40A to 43 Finance (No.2) Act 1992, section 48 Finance (No.2) Act 1997 and sections 130 to 144 of the Income Tax (Trading and Other Income) Act 2005 (ITTOIA 2005).

Contact details

Queries on particular cases or operational issues should be directed to the Manchester Film Tax Credit Unit. If you have any general/policy queries regarding the current rules or earlier reliefs for film production, please contact:

Nalini Arora
Enterprise, Incentives and Intangibles Team
CT & VAT Product and Process Group
HM Revenue and Customs
Room 3C-35
100 Parliament Street
LONDON
SW1A 2BQ

Email: Nalini Arora