To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential impact of the additional tax relief for visual effects on the visual effects industry.
Answered on
19 March 2024
At Spring Budget 2024, the government announced that from 1 April 2025, companies claiming the Audio-Visual Expenditure Credit (AVEC) will be able to receive a 5-percentage point increase in tax relief (a total rate of 39%) on UK visual effects costs in film and high-end TV productions. The government will also remove the AVEC’s 80% cap on expenditure for UK visual effects costs, so companies will be able to claim relief on all UK visual effects spend.
The policy objective is to incentivise companies to use more visual effects in their film and high-end TV productions, and for that visual effects work to be carried out in the UK.
The government will shortly publish a 10-week consultation on the types of cost that will be in scope of the additional tax relief.
As the details of policy are under development, the government cannot yet publish an assessment of its impact on the visual effects industry. The government will publish a Tax Information and Impact Note in due course.