Lights, Camera, Action! 40% business rates relief for film studios rolled out

From tomorrow 17 February, Local Authorities can begin rolling out local schemes for tax relief to help filmmakers produce the country’s next box office hits, rom-coms and cult classics.

Film studios are to receive business rates relief over the next nine years as the government rolls out a 40% reduction in business rates bills – to help drive growth and deliver the Plan for Change.

From 17 February, Local Authorities can begin implementing local schemes and awarding the tax relief to help filmmakers kickstart their journeys to producing the country’s next box office hits, cult classics and major rom-coms.

The UK’s creative sector already employs over 2.4 million people and is worth over £120 billion to the economy. The start of the business rates relief for film studios rollout will help create the conditions to boost both of these.

In October, the government confirmed that it would proceed with Film Studio Business Rates Relief that will be available for eligible studios in England until 2034, and, where applicable, will be backdated to 1 April 2024.

Chancellor of the Exchequer, Rachel Reeves, said:

The UK leads the world in creating great film and TV and we should all be immensely proud of the impact we’ve had across the globe.

From the Avengers to Indiana Jones, the UK has drawn in some of cinema’s biggest names thanks to a combination of fantastic local talent and a world-leading creative sector as well as attractive tax incentives.

As part of the Plan for Change, we will continue to build the sector into a global beacon of home grown success, creating more jobs, more investment, and putting more money into working people’s pockets.

This comes on top of a package of wider previous announcements for the creative industries announced on 17 January that included investments for start-up video game studios, grassroots music venues and creative businesses.

The relief will maintain the UK’s status as a world leader in the creative industries and will help deliver the Plan for Change by going further and faster to kickstart economic growth so working people have more money in their pockets.

The creative industries sector employs 2.4 million people and is worth £124.6 billion to the UK economy. Business rates relief forms part of the government’s wider strategy to support this vital growth sector, and forms a key part of our modern Industrial Strategy.

The film and TV sector benefits from other generous tax reliefs. The Audio-Visual Expenditure Credit (AVEC) provides companies with a tax credit worth 34% of their UK production costs on a film or high-end TV programme, or 39% of their production costs on an animation or children’s TV programme.

In addition, from 1 April 2025, film and high-end TV companies may claim a credit of 39% on their UK visual effects costs; and eligible films with budgets of under £15 million will be able to claim an enhanced 53% rate, known as the Independent Film Tax Credit.

Today (16 February), the UK film and TV industry will attend the BAFTA Film Awards that celebrate the many achievements of the sector and the significant cultural impact of British film and TV around the world.

Culture Secretary Lisa Nandy said:

The UK’s film industry is truly world class, producing global box office hits like Wicked and indie classics like Aftersun.

The sector has huge potential for further economic growth and the government is ambitious for its future. Our new tax incentive, as well as other new measures like indie film tax reliefs and £25 million funding for a new film studio in Sunderland, will help ensure we can continue to create British content, international blockbusters and high quality jobs.

Adrian Wootton OBE, Chief Executive of the British Film Commission:

The British film and TV industry is a creative and economic powerhouse, and our film studios are a vital contributor to this success. Today’s confirmation of the Business Rates Relief for Film Studios in England is testament to Government’s recognition of this fact. The BFC is pleased that Government listened to the sector’s concerns and we are proud to have supported the development of this landmark intervention. We will continue to work with Government and stakeholders to secure the best possible long term solution for all parties.

Harriet Finney, Deputy CEO and Director of Corporate & Industry Affairs, BFI said:

2024 saw a massive £5.6 billion of production spend in the UK, further confirming that our film and TV industries continue to be a powerful and vital growth industry. Our state-of-the-art studio spaces are central to that growth, so we welcome today’s announcement and the Government’s recognition of their crucial role in ensuring we can continue to make world-renowned UK film and TV and attract outstanding international productions, driving investment and creating jobs across the UK.

Sara Putt, Chair, BAFTA said:

The UK is a world-leading centre for film and TV production – our studios provide world-class facilities and the craft and production skills here are second to none, as showcased by the British-made films nominated in this year’s EE BAFTA Film Awards.  For those freelancers and crews to continue doing what they do best, it is vital that the UK remains competitive as a prospect for inward investment and continues to support a healthy talent pipeline to grow our domestic film and TV industry, so more UK talent and stories are celebrated at home and around the world.

Simon Robinson, Chief Operating Officer of Warner Bros. Discovery Studios said:

We welcome the Treasury’s announcement confirming its commitment to providing vital relief to business rates.  It will create a stable environment for long-term investment, including securing the Warner Bros. Studios Leavesden expansion, which will create 4,000 direct and indirect jobs, and the opportunity for continued growth of the industry in the UK and U.S.

More information

• The relief will be available on properties valued by the Valuation Office Agency (VOA) as film studios.
• The 40% reduction is inclusive of Transitional Relief. The value of any Transitional Relief a studio receives will be deducted from the value of the film studio relief. This means that eligible film studios’ final bills will be no more than 60% of their gross bill. Studios will remain eligible for Improvement Relief in addition to this relief, which will mean that no ratepayer will face higher business rates bills for 12 months as a result of qualifying improvements to a property they occupy.
• Film studios will not need to apply for the relief, as Local Authorities will award it to eligible properties. If in doubt, film studios should contact their local authority.

kaynak: GOV