In January 2024, the UK Government introduced a new Audio Visual Expenditure Credit (AVEC). Qualifying animated films, animated TV programmes and children’s TV programmes can access relief with a net value of 29.25%. All other qualifying features films and TV programmes can access relief with a net value of 25.5%.
Transitional rules apply to film and TV.
AVEC is available to companies with accounting periods ending on or after 1 January 2024.
If a company’s accounting period begins before 1 January 2024 but ends after 1 January 2024, it will have the option to apply existing rules on expenditure incurred up to 31 December 2023 and apply AVEC rules on expenditure incurred from 1 January 2024.
Where principal photography begins before 1 April 2025, existing rules remain available up to 31 March 2027. Existing rules will not be available to productions where principal photography commences on or after 1 April 2025.
Qualification criteria for each of the current film and TV reliefs remain unchanged within AVEC including:
UK expenditure on goods/services “used or consumed” in the UK.
Allocating expenditure between UK and non-UK remains on a “just and reasonable” basis.
TV minimum expenditure test is £1m of core expenditure per hour.
The cap of 80% remains and UK core expenditure higher than 80% of expenditure will not generate credit.
Minimum UK core expenditure threshold remains 10% of total core expenditure.