MGETR70110 - Museums and Galleries Exhibition Tax Relief: calculation: surrenderable losses and tax credit example

The following example illustrates how a Museums and Galleries Exhibition Production Company (MGEPC) that sustains a surrenderable loss, can surrender that loss in return for a Museums and Galleries Exhibition Tax Credit (MGETC). 

Example

A MGEPC undertakes an exhibition with total core expenditure of £100,000, all of which is UK expenditure. Income to date from the exhibition is £90,000. 

Income

£90,000

Expenditure

(£100,000)

Trading loss before Museums and Galleries Exhibition Tax Relief (MGETR)

(£10,000)

MGETR - Additional deduction (80% x £100,000 total core expenditure)

(£80,000)

Trading loss after MGETR

(£90,000)


The surrenderable loss is the lesser of:

  • the £90,000 trading loss after MGETR, and
  • the £80,000 additional deduction.
     

In this case the company can surrender up to £80,000, and chooses to surrender the full amount.  The company is not obliged to surrender the entire loss, but it will most likely do so.

Assuming the rates from 1 April 2025 apply, the amount of MGETC due is

  • £32,000 (40% x £80,000 loss surrendered) for a non-touring exhibition
  • £36,000 (45% x £80,000 loss surrendered) for a touring exhibition.