Audio-Visual Expenditure Credit (AVEC) will replace Film Tax Relief (FTR), Animation Tax Relief (ATR), Children's Television Tax Relief (CTR), High-End Television Tax Relief (HETR). Video Games Expenditure Credit (VGEC) will replace Video Games Tax Relief (VGTR).
Finance Act 2024 introduced a new regime for companies producing films, television programmes and video games.
From 1 January 2024:
- Audio-Visual Expenditure Credit (AVEC) can be claimed where a qualifying company has a qualifying film or qualifying television programme.
- Video Games Expenditure Credit (VGEC) can be claimed where a qualifying company has a qualifying video game.
- AVEC and VGEC provide relief in the form of payable credits arising from expenditure on production activities, see Creative Industries: AVEC worked example.
Reform to Expenditure Credits
- For qualifying expenditure incurred on or after 1 January 2024, companies claiming under Film Tax Relief (FTR), Animation Tax Relief (ATR), Children's Television Tax Relief (CTR), High-End Television Tax Relief (HETR), and Video Games Tax Relief (VGTR) can:
- Continue to claim FTR, HETV, CTR, ATR or VGTR.
- Or opt-in to claim Expenditure Credits(AVEC or VGEC).
- No election for AVEC or VGEC can be made for an accounting period ending before 1 January 2024.
- If a company makes an election for AVEC or VGEC for an accounting period beginning before 1 January 2024:
- FTR, HETV, CTR, ATR or VGTR will apply until 1 January 2024, and
- AVEC or VGEC will apply to the portion of the accounting period falling after 1 January 2024.
- New productions must claim under AVEC or VGEC from 1 April 2025.
- All productions must claim under AVEC or VGEC from 1 April 2027.
- FTR, ATR, HETR, CTR and VGTR will cease on 31 March 2027.
- Theatre Tax Relief (TTR), Orchestra Tax Relief (OTR), and Museums & Galleries Tax Relief (MGETR) are unaffected by the reform to expenditure credits.
Useful guides on this topic
Creative Industries Tax Reliefs: At a glance
What are Creative Industries Tax Reliefs? Which Creative Industries Tax Relief are you eligible for? When should relief be claimed under Audio-Visual Expenditure Credit (AVEC) and Video Games Expenditure Credit (VGEC)?
Creative Industries: Additional Information Form (AIF)
What are the additional information requirements? When should you complete the Additional Information Form (AIF)? What information is required?
Creative Industries: Audio-Visual Expenditure Credit (AVEC) & Video Games Expenditure Credit (VGEC)
Audio-Visual Expenditure Credit (AVEC) will replace Film Tax Relief (FTR), High-End TV Tax Relief (HETR), Animation Tax Relief (ATR), and Children’s TV Tax Relief (CTR). Video Games Expenditure Credit (VGEC) will replace Video Games Relief (VGTR).
Creative Industries: AVEC worked example
How to calculate the Audio-Visual Expenditure Credit (AVEC) and Video Games Expenditure Credit (VGEC)?
Creative Industries: AVEC worked example (with losses)
How to calculate the Audio-Visual Expenditure Credit (AVEC) and Video Games Expenditure Credit (VGEC)? How to determine the credit repayable to the company if it incurs losses?
Creative Industries: Film Tax Relief and Television Tax Relief
Film Tax Relief (FTR), High-End TV Tax Relief (HETR), Animation Tax Relief (ATR) and, Children’s TV Tax Relief (CTR) are part of the UK's suite of creative industry tax reliefs.
Creative Industries: Video Games Tax Reliefs (VGTR)
What is Video Games Tax Relief (VGTR)? Who can claim VGTR? When will VGTR cease?
Creative Industries: Theatre Tax Relief (TTR)
What is Theatre Tax Relief (TTR)? Who can claim it? What are the conditions?
Creative Industries: Orchestra Tax Relief (OTR)
What is Orchestra Tax relief? What are the qualifying conditions? What is the rate of relief?
Creative Industries: Museum & Gallery Exhibitions Tax Relief (MGETR)
What is Museum & Gallery Exhibitions Tax Relief? When does it apply?
