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83/09

24 September 2009

UK film makers get £100m support from tax relief

New figures showing the continued success of the Government’s film tax relief were released today. In 2008/09 over £100m of support has been provided for the production of over 170 UK films.

Since its introduction in 2007 film tax relief has been successful in promoting the sustainable production of British films. The relief increases the amount of expenditure in film production that is deductible for tax purposes.

Financial Secretary to the Treasury, Stephen Timms, said:

"The Government is committed to supporting the British film industry and the important role it plays in our economy. Today’s figures are excellent news for the industry, highlighting  the success of the UK’s film tax relief which is helping to stimulate investment in domestic film production.

"Film tax relief will continue to provide valuable assistance to this vibrant sector over the coming years."

Minister for the Creative Industries, Siôn Simon, said:

"The UK has been responsible for some tremendously successful films in the past year, both artistically and at the box office.  Without film tax relief this level of success simply wouldn’t be possible, with many of the big hits of recent years never making it into production.   

"Our thriving film industry creates jobs, attracts overseas investment, brings tourists to the UK and contributes a huge amount to our cultural heritage, so film tax relief is an investment that is repaid many times over".

For a film to be eligible it must qualify as British, either by passing the cultural test administered by the Department for Culture, Media and Sport, or under an agreed co-production treaty. Additionally, at least 25 per cent of the total production expenditure must be incurred in the UK.

The figures also demonstrate the positive effect of HM Revenue & Customs dedicated Film Tax Credit Unit, which handles claims for the relief. In the past year, over 95 per cent of payments were made within 6 months of the claim being received. This is providing vital support to the UK film industry to ensure it can come through the downturn even stronger than before.

Notes for Editors

1. These provisional figuress cover the 2008/09 financial year, ending on 31 March 2009.

2. Film tax relief is available to film production companies, based on the expenditure incurred in the production of films intended for theatrical release in commercial cinemas.

3. Relief can only be claimed on production expenditure incurred in the UK, up to a maximum of 80% of the total budget.  A higher rate of relief is available for limited-budget films (those with total production expenditure of £20m or less). Companies not making a profit may be able to surrender the relief for a payable tax credit worth up to 20% of the total budget for a limited-budget film and up to 16% for other films. A higher value of support may be achieved if the relief is not surrendered but used instead to reduce the company’s tax liabilities.

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