Supporting The Arts And Entertainment Industry Through COVID-19
If your clients work in the arts and entertainment industry, support is available both during and after the pandemic.
Various options available
The devastating impact of coronavirus on the UK’s arts and entertainment sector has been widely publicised. Multiple lockdowns have seen cinemas, galleries, exhibition centres and theatres close their doors, some for the last time. Film production has slowed right down and crowded stadiums feel like a thing of the past - for now at least.
As of August 2020, according to Statista data approximately 76% of UK businesses in the arts, entertainment and recreation sector had seen a reduction in footfall during the course of the pandemic. Despite plenty of fresh hope in the form of vaccines and summer on the way, COVID-19 rumbles on. With restrictions and social distancing still very much here to stay, what’s available to help the arts and entertainment industry survive?
Existing government support for the sector
Long before we’ve even heard of coronavirus, back in October 2019 the government unveiled its plans for a £250 million investment fund specifically set aside for the culture and creative sector. It was hailed by ministers as one of the largest investments ever made in our cultural infrastructure, neighbourhood libraries and local museums.
Then the pandemic hit and in the spring of 2020 a further raft of government support measures were put in place. These included the Self Employed Income Support grants, the furlough scheme and business rates holidays. The Arts Council also stepping in, providing an initial £160 million emergency response package.
As the crisis deepened, the government then went further when, on the 5th July 2020, it announced a £1.57 billion rescue package for the UK’s arts, culture and heritage industries. Measures that made up the package include:
- £1.15 billion support grants and loans for cultural organisations in England. At the time of launch, this consisted of £880 million in grants and £270 million of repayable finance
- £120 million capital investment to restart heritage and cultural infrastructure projects previously paused due to the COVID-19 pandemic
- £100 million of targeted support for the English Heritage Trust and other national cultural institutions in England.
An additional £188 million was also made available for the devolved nations. This was divided up as follows:
- £33 million for Northern Ireland
- £97 million for Scotland
- £59 million for Wales
Aside from central government emergency COVID-19 measures, what else is there?
Despite these measures, many businesses in this industry continue to struggle. With this in mind, it’s well worth being aware of other support available, both during the pandemic and afterwards.
Arts Council funding
The Arts Council invests public money from the National Lottery and from government to make sure creativity flourishes and that everyone can access a wide range of high quality cultural experiences. During the COVID-19 crisis, it has launched several funding rounds offering a mix or grants and loans to eligible businesses within the arts, culture and creative industries.
If your client’s businesses is in this sector, we strongly recommend pointing them in the direction of the Arts Council website. All the latest rounds of funding are announced on their COVID-19 support page, together with further details and how to apply.
Local authority support
Recent government statistics indicate that creative industries, particularly SMEs specialising in arts, design, culture, music, TV and film, contribute over £111 billion to the UK economy each year. Councils have always been offered a range of supports for smaller businesses and start-ups in particular, with many backing the creative industries particularly during COVID-19.
Representing authorities in England and Wales, the Local Government Association sees supporting the sector as crucial in helping local economies recover. It has there published a guide to help councils to support their local creative industries.
Councils of course are facing their own funding pressures and have done for some years. But for the vast majority, offering support to creative industries is still a top priority.
Each council has its own offerings, from grants and loans to a wealth of supportive information. It's therefore worth encouraging your clients working in this sector to contact their local authority in order to find out exactly what's available in their area.
R&D Tax Credits
The R&D Tax Credits scheme isn’t specific to the arts and entertainment sector per se; it’s actually open to any UK company that’s subject to Corporation Tax. But it’s an incredibly generous tax incentive, designed to help pay for the costs of growth and innovation - and far too many businesses are still missing out.
R&D Tax Credits work by ‘refunding’ a percentage of research and development costs back to companies that have undertaken eligible R&D projects over the last two years. The relief is provided either as a credit against Corporation Tax, or as cash lump sum payments if the company has made a loss. And with as much as 33 pence in every £1 of qualifying R&D expenditure reclaimable, claims can easily run into the tens of thousands of pounds.
Essentially, if a company has looked to resolve a particular scientific or technological uncertainty that benefits the entire field then it may well be eligible for the relief. Perhaps it developed a new product, process or service from scratch where the outcome was uncertain, or it updated something that already exists. And if a company develops computer games for any kind of platform, there’s Video Games Tax Relief too.
Why claiming R&D Tax Credits through the Tax Cloud portal makes sense
The Tax Cloud portal is a simple to use, great value online solution that means accountants can make accurate, high quality R&D Tax Credit applications on their clients’ behalf.
Developed four years ago by the R&D tax and funding experts at Myriad Associates, the portal means your clients can achieve the crucial tax relief they deserve, whilst your firm diversifies its services and boosts its reputation.
Designed to benefits SMEs in particular, it’s simply a case of following the steps to supply information, figures and technical report. Accessible from any internet-connected device 24/7 it seamlessly integrates with Xero. Our technical experts are on hand whenever you need us, and of course there’s a generous partner package available too.