In a bid to make the UK the new “technology centre of Europe”, the government introduced corporation tax reliefs for the creative sector in this years' Finance Bill.
In addition, a taxable, above the line (ATL) research and development tax credit of 9.1% for large companies, starting 1 April 2013.
Tax reliefs for creative industries
The reliefs will apply to the animation, video-game and high-end television programme industries from 1 April 2013 to support investment in their production.
Under the new legislation, companies will be able to claim an additional deduction of 100% of UK qualifying production expenditure. Where this results in a loss, companies will be able to surrender losses for a payable tax credit worth up to 25% of qualifying production expenditure.
The legislation also sets out anti-avoidance rules to stop the relief being taken advantage of, including similar rules to the film tax relief to prevent artificial inflation of claims.
Reliefs for each of the three sectors will be modelled on the existing film tax relief, which according to the government has been highly successful.
The government said it's introducing these reliefs to support further growth in the creative sector.
About Rachael Power
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