Film/TV tax transition

The measure

The government has announced a change to the existing Film Tax Relief (“FTR”) rules that will allow productions to continue to qualify for relief even if they switch from an intention for theatrical release to an intention for broadcast via television or the internet. 

Historically, for a film to qualify for FTR, the film must be intended to be released in theatres and this test must be met at the end of every accounting period. This meant that any change in the intention for a theatrical release during the development of the film could result in the film no longer attracting relief. However, the amendment to the rules will allow productions to continue claiming FTR upon a change in the intended release, provided that the production still meets the conditions for the existing High-End TV (“HETV”) relief rules.


Who will be affected?

UK film production companies producing films where the intention for theatrical release changes to an intention to broadcast via television or the internet.


When will the measure come into effect?

The measure will have effect from 1 April 2022.

Our view

The proposed measure will be a welcome change for the film production industry, which in recent years has seen a transition from theatrical to on-demand releases. This trend was accelerated as a result of the COVID-19 pandemic and the associated closure of cinemas, causing a number of productions to be postponed so as not to forfeit FTR. 

In order to take advantage of this measure production companies should be mindful of the 1 April 2022 effective date, and the requirement to meet the conditions for HETV relief.