UK Film Council Welcomes New Tax Relief Plans

by Robin Pilgrim, LawAndTax-News.com, London

24 September 2004

In a statement released on Tuesday, the UK Film Council welcomed the government's newly announced film tax relief measures for lower budget UK films.

The main features of the new tax relief scheme are that:

• The money will be paid direct to film-makers, not through third parties, so it will be less open to abuse;
• The relief will cover 20% of production costs compared to the 15% covered by the old Section 48 relief;
• Films with budgets of up to £20 million will be able to benefit, compared to a limit of £15 million under Section 48;
• For the first time, the relief will include an added incentive for films to be profitable;
• The relief applies to all production expenditure, not just that spent in the UK; and
• The maximum relief which can be claimed on a qualifying film will rise typically to £4 million compared to £2.25 million under Section 48.

The new regime will come into effect from July next year, when the old Section 48 relief will expire.

Speaking following the unveiling of the new measures earlier this week at a Downing Street ceremony, UK Film Council Chief Executive Officer John Woodward observed that:

“Film is a £5 billion a year British industry and a rich and popular part of our culture, and this is a welcome recognition of its economic and creative importance."

He went on to add that:

"As with Section 48, the new tax credit will take a few months to bed down, but it is extremely good news that the new relief will apply to 100% of a film’s spending on production in the UK, and increases the budget of films which can qualify for support from £15 million to £20 million."

Recommended