December 15th, 2020 / Insight posted in Articles

Creative sector tax reliefs

TV and animation production
Tax relief for high end television and animation production is one of a number of tax reliefs for the creative sector. These are are intended to help support technological innovation and ensure that companies working in highly creative industries continue to contribute to the UK’s economic growth and to British culture. This document will provide details on the high-end television and animation production tax reliefs. Separate publications are available covering the other creative sector tax reliefs.

Theatre
Some theatre productions are eligible for Theatre Tax Relief. This relief can increase the amount of expenditure that is allowable as a deduction for tax purposes or, if the company makes a loss, can be surrendered for a payable tax credit. This can provide a 25% subsidy towards the costs of producing a Theatrical Production.

Orchestra
Some orchestral concerts are eligible for orchestra tax relief. This relief can increase the amount of expenditure that is allowable as a deduction for tax purposes or, if the company makes a loss, can be surrendered for a payable tax credit. This can provide a 25% subsidy
towards the costs of producing an orchestral concert or, by election, an orchestra concert series.

Museums and galleries
Some museums and galleries are eligible for Museums and Galleries Exhibition Tax Relief (ETR). This relief can increase the amount of expenditure that is allowable as a deduction for tax purposes or, if the company makes a loss, can be surrendered for a payable tax credit. This can provide a 20% subsidy (for non-touring exhibitions) or 25% subsidy (for touring exhibitions) towards the costs of producing a museum or gallery exhibition, even where a charitable company does not normally pay corporation tax.

Film
Special tax rules apply to determine how the taxable profits of film production companies are to be calculated and how any losses may be applied. Some films are eligible for Film Tax Relief (FTR). This relief can increase the amount of expenditure that is allowable as a deduction for tax purposes or, if the company makes a loss, can be surrendered for a payable tax credit. This can provide a 25% subsidy
towards the cost of making a film.

These documents provide only a brief summary of the issues surrounding creative sector tax reliefs. If you would like to discuss your particular circumstances, contact us on 020 7566 4000 or pd@mks.co.uk.