The UK film industry is an ever-evolving and vibrant sector of the economy, and with it comes a range of funding and tax incentives for filmmakers. One such incentive is the Film Tax Relief (FTR) scheme, which has been in place since 2007 and is designed to encourage the production of films in the UK. In this article, we will explore the Film Tax Relief scheme in detail and provide an overview of the key elements to consider. We will look at how it works, who can benefit from it, and the potential advantages it offers to filmmakers. The Film Tax Relief (FTR) scheme was introduced in April 2007 and is available to any British film or co-production which meets the criteria of the Cultural Test. It applies to film production costs incurred on or after 1st April 2007. The main purpose of the scheme is to encourage inward investment into the UK’s film industry.
It also provides significant tax benefits for both companies and individuals involved in the production of qualifying films. The FTR scheme provides a 25% tax relief on core expenditure incurred on eligible films. It is payable as a deduction from profits when calculating Corporation Tax for companies involved in production, or as a rebate for individuals who have invested in film production. Eligible expenditure includes costs associated with producing films such as costs of personnel (including actors, directors, and writers), equipment hire costs, and distribution costs. It also includes costs associated with post-production activities such as special effects and editing. Eligibility for the FFT scheme is based on a Cultural Test which assesses the cultural content of a film against a number of criteria.
These include whether the story is set in the UK or another European country, whether the main characters are British or European, and whether at least half of the crew are either British or European citizens. The test also looks at other factors such as whether the film promotes British culture and heritage, and whether it contains elements of British creativity or innovation. In addition to providing tax relief for productions, the FTR scheme also provides funding for training and development opportunities for new and emerging talent in the film industry. This includes funding for apprenticeships, internships, and courses related to film production. It also provides funding for research and development projects related to new technologies and techniques which can be used in film production.
Who is Eligible for Film Tax Relief?To qualify for FTR, a production must pass the Cultural Test set out by the British Film Institute (BFI).
This test assesses criteria such as whether the story is set in Britain or another European country, whether at least half of the crew are British or European citizens, and whether it promotes British culture or heritage. In addition to passing this test, applicants must be able to demonstrate that they have incurred eligible expenditure on their production. This includes costs associated with producing films such as personnel costs, equipment hire costs, and distribution costs. It also includes post-production activities such as special effects and editing.
Benefits of the Film Tax Relief SchemeThe main benefit of the FTR scheme is that it provides significant tax relief for companies and individuals involved in film production in the UK. This helps to reduce costs associated with producing films in the UK, making it more attractive for investors to fund films here. It also encourages inward investment into the UK’s film industry, which helps to create jobs and generate economic activity. The scheme also provides funding for training and development opportunities for new and emerging talent in the film industry.
This helps to develop skills within the industry, which can help to ensure that Britain remains a leader in film production. The Cultural Test criteria helps to ensure that films produced under the FTR scheme meet certain cultural requirements. This helps to ensure that films produced in Britain promote British culture and heritage. The UK Film Tax Relief (FTR) scheme is a vital component of the British film industry, providing tax relief for companies and individuals involved in production, as well as funding for training and development opportunities for up-and-coming talent. To be eligible for FTR, a film needs to pass a Cultural Test that assesses its cultural content. By offering these incentives, it encourages inward investment into the UK film industry, creating jobs and boosting the economy. The FTR scheme can be an invaluable source of support for filmmakers looking to break into the industry, allowing them access to funding, training and tax relief.
By providing these incentives, it helps ensure the continued growth and success of the UK’s film industry.