MMP Tax Ltd - R&D Tax Relief, RDEC, RDA, Patent Box & VGTR
Animation Tax Relief

Despite the UK’s success in creative animation, there is evidence that animated productions are moving abroad.

The government wants to incentivise new UK productions and has made this relief as generous and as simple as possible.

The relief allows for 100% additional tax deduction on qualifying expenditure up to a maximum of 80% of overall expenditure, with a 25% payable tax credit of qualifying expenditure (equating to 20% of overall expenditure).

The legislation has specific rules: for instance, any animation production must be scheduled for broadcast; mixed content productions will be deemed to be animation as long as animation makes up at least 51% of the total production costs; but certain categories will not be eligible (e.g. programmes containing animation that are produced for training purposes).

Qualifying expenditure incurred after 1 April 2013 is eligible for the relief.

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