Key facts
- From 1 January 2024, the Audio-Visual Expenditure Credit (AVEC) replaces the old film, TV, and animation reliefs.
- The Video Games Expenditure Credit (VGEC) replaces the former Video Games Tax Relief.
- Credits are 39% of qualifying UK expenditure for film, high-end TV, and animation (25% for video games).
- Projects must be certified by the British Film Institute (BFI) as culturally British.
- Theatre, orchestra, and museum/gallery reliefs continue as separate expenditure credits.
Overview of the New Regime
The creative industry tax reliefs were overhauled from 1 January 2024 (for film, TV, animation, and video games) to move from an enhanced-deduction model to an expenditure credit model, similar to the merged R&D scheme.[1]
The new structure comprises:
- Audio-Visual Expenditure Credit (AVEC) — for film, high-end television, animation, and children’s television
- Video Games Expenditure Credit (VGEC) — for video games development
- Theatre Tax Relief, Orchestra Tax Relief, Museums & Galleries Exhibition Tax Relief — continued as separate expenditure credits at enhanced rates
Audio-Visual Expenditure Credit (AVEC)
AVEC is available to companies responsible for the production of qualifying films, high-end TV programmes, animation programmes, and children’s TV.[2]
| Type | Credit Rate | Minimum UK Spend |
|---|---|---|
| Film | 39% of qualifying UK expenditure | 10% of core costs |
| High-end TV | 39% of qualifying UK expenditure | 10% of core costs |
| Animation | 39% of qualifying UK expenditure | 10% of core costs |
| Children’s TV | 39% of qualifying UK expenditure | 10% of core costs |
The credit is calculated on qualifying UK core expenditure — meaning expenditure on goods and services used or consumed in the UK during production. The credit is capped at 80% of total core expenditure, preventing claims where almost all work is done overseas.[2]
Independent films: Films with a core expenditure budget of £15 million or less and certified as independent may qualify for an enhanced credit of 53%.[2]
Video Games Expenditure Credit (VGEC)
VGEC applies to companies developing video games that are intended for supply to the general public. The credit rate is 25% of qualifying UK expenditure.[3]
To qualify, the game must:
- Be intended for supply to the general public
- Be certified as a British video game by the BFI
- Have at least 25% of core expenditure spent in the UK
- Not be produced for advertising, promotional, or gambling purposes
BFI Cultural Certification
All claims under AVEC and VGEC require a cultural test certificate issued by the British Film Institute (BFI). The test awards points across four sections:[4]
| Section | What It Tests | Max Points |
|---|---|---|
| A – Cultural content | British setting, characters, subject matter, dialogue | 16 |
| B – Cultural contribution | Creativity, innovation, use of new technology | 4 |
| C – Cultural hubs | Use of UK facilities and post-production | 3 |
| D – Cultural practitioners | British or EEA nationals in key creative roles | 8 |
A project must score at least 18 out of 35 points (16 out of 31 for film) to pass the cultural test. Alternatively, it can qualify as an official co-production under one of the UK’s bilateral treaties.
Theatre, Orchestra & Museums Reliefs
Separate expenditure credits apply to qualifying live performances and exhibitions:[1]
| Relief | Credit Rate | Notes |
|---|---|---|
| Theatre Tax Relief | 45% (touring) / 40% (non-touring) | Plays, musicals, dance, circus — for live performance to paying audiences |
| Orchestra Tax Relief | 45% (touring) / 40% (non-touring) | Concerts by orchestras, ensembles, and choral groups |
| Museums & Galleries Exhibition Tax Relief | 45% (touring) / 40% (non-touring) | Charitable exhibitions open to the public |
These rates were temporarily enhanced during COVID recovery (2022–2025) and have now settled at the permanent rates shown above. Claims for all of these credits are made on the company’s Company Tax Return — CT600 filing software includes the supplementary pages you need.
Tip: The credit is calculated on qualifying UK core expenditure. For theatre and orchestras, this includes direct production costs such as sets, costumes, lighting, performers’ fees, and rehearsal space — but not marketing or front-of-house costs.
Frequently Asked Questions
What are creative industry tax reliefs?
They are Corporation Tax reliefs for companies producing films, TV programmes, animation, video games, and live performances. From 2024, the reliefs operate as expenditure credits calculated on qualifying UK expenditure.
How much is the film and TV tax credit?
The Audio-Visual Expenditure Credit provides a credit of 39% of qualifying UK expenditure for film, high-end TV, animation, and children’s TV. Independent films with budgets of £15 million or less may qualify for an enhanced rate of 53%.
What is the Video Games Expenditure Credit?
VGEC provides a credit of 25% of qualifying UK expenditure for companies developing video games intended for the general public. The game must be certified as culturally British by the BFI and have at least 25% of core expenditure in the UK.
Do I need BFI certification to claim creative industry tax relief?
Yes. All claims under AVEC and VGEC require a cultural test certificate issued by the British Film Institute (BFI), confirming the project scores enough points to be certified as culturally British.
Further Reading
- R&D Tax Relief — relief for innovation in science and technology
- The Merged R&D Scheme — the unified R&D credit from April 2024
- Patent Box — reduced CT rate on profits from patents
- The CT600 Tax Return — how to include creative industry claims
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