The Chancellor announced, as part of his Budget, audio visual tax reliefs in the form of tax credits using the existing Research and Development Expenditure Credit (RDEC) as a basis.
The government will adapt the RDEC model to ensure the exact process of claiming the expenditure credits is designed in a way that will work effectively for the audio-visual subsectors.
The government will implement two models: one for the film and TV expenditure credits, which will be merged into a single scheme (the Audio-Visual Expenditure Credit), and one for video game expenditure credits (the Video Games Expenditure Credit).
The rates of relief will be:
Audio-Visual Expenditure Credit (AVEC):
- Films and high-end TV programmes will have a headline rate of 34%; and
- Animations and children’s TV programmes will have a headline rate of 39%.
Video Games Expenditure Credit (VGEC):
- Headline rate of 34%.
The new reliefs have arisen as a result of the previous consultation.
Related content from Claritax Books
The UK’s special tax rules for Research and Development expenditure continue to offer valuable tax relief for companies.
This book explains how the scope of R&D relief is wider than is often imagined, whilst also showing the statutory conditions that must be met for a successful claim. The book is now being updated to reflect changes in the Autumn statement of November 2022 and the Budget of 15 March 2023, and the new edition will be available in the second quarter of 2023.