HMRC paid out more than £1bn in creative sector tax relief in the UK during 2018/19. The total paid out since introduction is now approaching £5bn. Creative sector tax reliefs were designed to encourage more investment into cultural activity across the UK. The tax relief allows qualifying companies to make a deduction in their taxable profits, and those which don’t make a profit can surrender the tax relief for a payable tax (cash) credit.
Film companies benefited most during 2018/19, showing 40% growth compared to the previous year. High-end TV showed a similar level of growth. However, all creatives sectors, including animation, children’s TV, video games, theatre, orchestra and museums/galleries, benefited significantly from the creative sector tax reliefs during 2018/19.
In particular, this was the first-year statistics were available for museum and gallery claims – although there has been take up, the £4m paid out to date reflects that this is still a new relief and there is likely a number of productions where claims have either not been made or maximised.
