Official Statistics

Creative industries statistics commentary: August 2022

Published 18 August 2022

1. Summary

In the year ending March 2022, a total of £1.05 billion was paid out across all the creative industries tax reliefs. This is a decrease from £1.32 billion in the year ending March 2021. The fall was mainly driven by a sharp drop in the amount of Film tax relief. In the year ending March 2022, High-end television (HETV) tax relief accounts for 38% of the total amount paid out and Film tax relief accounts for 35% of the total (Figure 1 and Table 1). This is the first time that the amount of HETV tax relief has exceeded Film tax relief.

Figure 1: Creative industries tax reliefs (£ million, receipts basis), 2019-20 to 2021-22

Table 1: Number of projects, claims and amount of creative industries tax relief paid out (£ million) in 2021-22

Relief	Number of projects	Number of claims	Amount of relief paid
Film	715	720	362
High-End TV	355	370	397
Animation	85	80	17
Video Games	580	330	197
Children’s TV	85	70	16
Theatre	2,055	620	38
Orchestra	510	100	10
Museum	1,060	145	9
Total	5,445	2,435	1,046

The number of projects refers to the number of films, programmes, games, productions or exhibitions.

2. Introduction

This is an Official Statistics publication produced by HM Revenue and Customs (HMRC). It provides information on the number and value of claims for film, high-end television, animation, video games, children’s television, theatre, orchestra, and museums and galleries exhibition tax reliefs, for the financial years up to March 2022.

The statistical tables are published on GOV.UK alongside this commentary document, together with information on the background and methodology.

This is an annual release and the next release is planned to be in Summer 2023.

The tax relief amounts paid out in the year ending March 2022 mainly relate to activity which took place in earlier years. The impact of the Covid-19 pandemic will be seen in this year’s statistics.

The amount of relief paid on an accruals basis allocates the claims to the financial year when the company’s accounting period ended. There is a lag in the data as companies have a year after the end of their accounting period to file their Corporation Tax return, and a further year to make, withdraw or amend a claim.

The amount of relief paid on a receipts basis allocates the claims to the year the payment was made.

Statistical contacts: N. Chowdhury, P. Patel and D. Parry; ct.statistics@hmrc.gov.uk

Media enquiries: HMRC Press Office; news.desk@hmrc.gov.uk

3. Film tax relief

Film tax relief (FTR) allows qualifying film production companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. A company may make several tax relief claims for a film during the production process, A claim may cover several films.

Since FTR was introduced in 2007, companies have made claims for 4,250 films, with UK expenditure of £21.6 billion.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £362 million of FTR was paid in response to 720 claims, representing 715 films. This is a 41% fall in the amount of relief paid, compared with the previous year. Before this, the number and cost of claims on a receipts basis has generally tended to increase year on year (see Figure 2, Table 1.3), but with some volatility in recent years. The fluctuations are greatest for claims worth over £5 million (Table 1.4). A total of £4.8 billion has been paid since 2007.

Figure 2: Amount of film tax relief paid (£ million, receipts basis) 2006-07 to 2021-22

Figure 3: Number of films and number of claims (receipts basis), 2006-07 to 2021-22

In the year ending March 2022, 65% of all claims were for £100,000 or less. The proportion is similar to last year. Despite only 2% of the claims being for over £5 million in the year ending March 2022, they account for more than half of the total amount paid.

Number and value of claims by date paid (accruals basis)

The accruals data (Figure 4 and Table 1.2) show a sharp decline in the amount of FTR for the year ending March 2021, reflecting the impact of Covid restrictions, particularly in the second quarter of 2020. There was a smaller decrease in the number of claims. Compared with the receipts data, the accruals data show a smoother trend up to the year ending March 2020. The proportions of the total relief amount paid out in the same year and the following year have varied considerably, resulting in a more volatile profile on a receipts basis.

Figure 4: Amount of film tax relief paid (£ million, accruals basis) 2006-07 to 2020-21

4. High-end television tax relief

HETV tax relief allows qualifying production companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. A company may make several tax relief claims for a programme during the production process. A claim may cover several programmes.

Since HETV tax relief was introduced in 2013, companies have made claims for 925 programmes, with UK expenditure of £10.9 billion.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £397 million of HETV tax relief was paid in response to 370 claims, representing 355 programmes. The amount of tax relief rose by 5% from the previous year (Figure 5 and Table 2.3), a lower growth rate than in earlier years. A total of £1.9 billion has been paid since the relief was introduced.

Figure 5: Amount of HETV tax relief paid (£ million, receipts basis) 2013-14 to 2021-22

Figure 6: Number of HETV programmes and number of claims (receipts basis), 2013-14 to 2021-22

In the year ending March 2022, 43% of the number of claims were for less than £250,000 – however, these only accounted for 3% of the total amount paid. Large claims over £2 million accounted for nearly two-thirds of the total amount paid. This proportion has decreased from the previous year.

Number and value of claims by date paid (accruals basis)

The accruals data (Figure 7 and Table 2.2) show a 60% increase in the amount of relief paid for the year ending March 2020. This was followed by a 29% fall in the amount of relief for the year ending March 2021, although the number of claims remained stable. The fluctuations were mainly driven by claims for large budget productions which had been expanding rapidly but were affected by the Covid restrictions, particularly in the second quarter of 2020. The trend is smoother on a receipts basis (Figure 5 and Table 2.3) because some claims for the year ending March 2020 were received later than usual and were paid out in the year ending March 2022.

Figure 7: Amount of HETV tax relief paid (£ million, accruals basis) 2013-14 to 2020-21

5. Animation tax relief

Animation tax relief (ATR) allows qualifying animation companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. A company may make several tax relief claims for a programme during the production process. A claim may cover several programmes.

Since ATR was introduced in 2013, companies have made claims for 415 programmes, with UK expenditure of £759 million.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £17 million of ATR was paid in response to 80 claims, representing 85 programmes. A total of £117 million has been paid since the relief was introduced (Table 3,3).

Figure 8: Amount of animation tax relief paid (£ million, receipts basis) 2013-14 to 2021-22

Figure 9: Number of animation programmes and number of claims, 2013-14 to 2021-22

In the year ending March 2022, 24% of ATR claims were for values of over £250,000 and they accounted for 78% of the total amount paid out.

6. Video games tax relief

Video games tax relief (VGTR) allows qualifying video games companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. A company may make several tax relief claims for a game during the production process. A claim may cover several games.

Since VGTR was introduced in 2014, companies have made claims for 1,940 games, with UK expenditure of £5.1 billion.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £197 million of VGTR was paid in response to 330 claims, representing 580 games. The amount of relief increased by 4% compared with the previous year (Figure 10 and Table 4.3). The accruals data (Table 4.2) show an increase in the year ending March 2021, reflecting the resilience of the video games industry during the Covid pandemic. A total of £830 million has been paid since the relief was introduced.

Figure 10: Amount of video games tax relief paid (£ million, receipts basis) 2014-15 to 2021-22

Figure 11: Number of video games and number of claims, 2014-15 to 2021-22

In the year ending March 2022, the majority of claims tend to be for smaller amounts, with 49% of all claims being for £50,000 or less; however, these claims are only responsible for 1% of the total amount paid out. Claims over £500,000 account for 88% of the total amount paid out. This proportion is similar to the previous year.

7. Children’s television tax relief

Children’s television tax relief (CTR) allows qualifying companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. It is an extension of high-end television tax relief and animation relief, but is specifically aimed at the producers of children’s television programmes.

Since CTR was introduced in 2015, companies have made claims for 430 programmes, with UK expenditure of £499 million.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £16 million of CTR was paid in response to 70 claims, representing 85 programmes. A total of £96 million has been paid since the relief was introduced.

Figure 12: Amount of children’s TV tax relief paid (£ million, receipts basis) 2015-16 to 2021-22

Figure 13: Number of children’s TV programmes and number of claims, 2015-16 to 2021-22

In the year ending March 2022, only 14% of the claims were for amounts over £500,000, but these account for 57% of the total amount paid out.

8. Theatre tax relief

Theatre tax relief (TTR) was announced in the Finance Act of 2014 and introduced in September 2014. Theatrical production companies are not required to pass a cultural test to be eligible to claim tax relief. A theatre production company may make several claims during the production process. A claim may cover several productions.

Since TTR was introduced in 2014, £392 million has been paid out relating to 5,345 claims. This represents 17,820 productions.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £38 million of TTR was paid in response to 620 claims, representing 2,055 productions. Of the productions, 71% were non-touring.

Figure 14: Amount of theatre tax relief paid (£ million, receipts basis) 2015-16 to 2021-22

Figure 15: Number of theatre productions and number of claims (receipts basis), 2015-16 to 2021-22

The highest proportion of claims are for smaller amounts, with 51% of all claims being for £10,000 or less in the year ending March 2022 whilst claims over £250,000 represented just 5% of the claims made but 60% of the total amount paid out.

Number and value of claims by date paid (accruals basis)

The accruals data (Figure 16 and Table 6.1) show that the number of productions and amount of relief dropped by around half in the year ending March 2021. Theatres were severely affected by Covid restrictions, resulting in falling revenues and reduced expenditure on new productions. To support theatres as they recover from the impact of Covid, the government announced a temporary increase in the rates of TTR for productions which commenced production on or after 27 October 2021.

Figure 16: Amount of theatre tax relief paid (£ million, accruals basis) 2015-16 to 2020-21

9. Orchestra tax relief

Orchestra tax relief (OTR) was introduced in April 2016. Orchestral production companies are not required to pass a cultural test to be eligible to claim tax relief. An orchestral production company may make a number of claims, receiving payments at stages throughout the production process. A claim may cover several productions. If a company has made an election covering multiple productions, then the series of productions is treated as a single production.

Since OTR was introduced, £62 million has been paid out relating to 615 claims. This represents 2,640 productions.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £10 million of OTR was paid in response to 100 claims, representing 510 productions. While the number of claims has decreased by more than 40% since the previous year, the amount of relief has only fallen slightly (Table 7.2). The accruals data (Table 7.1) show a large drop in the number of productions and amount of relief for the year ending March 2021. To support orchestras as they recover from the impact of Covid, the government announced a temporary increase in the rates of OTR for concerts which commenced production on or after 27 October 2021.

Figure 17: Amount of orchestra tax relief paid (£ million, receipts basis) 2016-17 to 2021-22

Figure 18: Number of orchestra productions and number of claims, 2016-17 to 2021-22

The highest proportion of claims are for smaller amounts. Claims of £5,000 or less represented 44% of the claims in the year ending March 2022. While only 9% of all claims were for amounts over £250,000, they represented 74% of the amount paid.

10. Museums and galleries exhibition tax relief

Museums and galleries exhibition tax relief (MGETR) was introduced in April 2017. Exhibition companies are not required to pass a cultural test to be eligible to claim tax relief. Relief is only available to charitable companies, and to subsidiaries of charities and local authorities. Tax credits are capped per exhibition at a maximum of £100,000 (touring) or £80,000 (non-touring). A museum or gallery may make a number of claims, receiving payments at stages throughout the exhibition process. A claim may cover several exhibitions.

Since MGETR was introduced, £43 million has been paid out relating to 560 claims. This represents 3,990 exhibitions.

Number and value of claims by date paid (receipts basis)

In the year ending March 2022, £9 million of MGETR was paid in response to 145 claims, representing 1,060 exhibitions. The number of claims, number of exhibitions and amount paid have all decreased since the previous year. To support museums and galleries as they recover from the impact of Covid, the government announced a temporary increase in the rates of MGETR for exhibitions which commenced production on or after 27 October 2021.

Figure 19: Amount of museums and galleries exhibitions tax relief paid (£ million, receipts basis) 2018-19 to 2021-22

Figure 20: Number of museum and galleries exhibitions and number of claims, 2018-19 to 2021-22

The highest proportion of claims are for smaller amounts, with 52% of all claims being for £25,000 or less in the year ending March 2022. Only 15% of claims were over £100,000 but they accounted for 63% of the total amount paid out.