CREC061100 - Expenditure credit calculation: steps 1-2

S1179CA CTA 2009 

Step 1

Find the amount of relevant global expenditure incurred on the production up to the end of the accounting period for which the company is making a claim. This includes any expenditure incurred on the same production in previous accounting periods. 

Relevant global expenditure is core expenditure that must be brought into account as part of the separate production trade (CREC031000). It also must not be excluded expenditure.  

Core expenditure is expenditure incurred on: 

  • Pre-production, principal photography and post-production of a film or TV programme 

  • Designing, producing and testing a video game 

Excluded expenditure is expenditure that qualifies for relief under one of the Research and Development (R&D) schemes, or expenditure that represents connected party profit if the arm’s length exception does not apply – see CREC052000. 

See CREC051000 for detailed guidance on relevant global expenditure. 

Step 2 

Deduct any expenditure incurred on the production that is not UK expenditure (CREC054000). UK expenditure is expenditure on goods and services that are used or consumed in the UK, so at this step companies should deduct any expenditure that is not used or consumed in the UK.  

The result is the amount of UK expenditure to date.