TTR55110 - Calculation: surrenderable losses and Theatre Tax Credit – example - single-period production
The following example illustrates how a Theatrical Production Company (TPC) that sustains a surrenderable loss can surrender that loss in return for a Theatre Tax Credit (TTC) (TTR55100). In this case the production is completed within a single period.
Example
A TPC makes a qualifying production with total core expenditure of £1m, all of which is UK expenditure. The production was commissioned by a producer who pays £900k for it. The production is presented at eight separate premises and meets the touring conditions.
- |
Amount |
|---|---|
Income |
£900k |
Expenditure |
(£1m) |
Trading loss before Theatre Tax Relief (TTR) |
(£100k) |
Theatre Tax Relief - additional deduction |
(£800k) |
Trading loss after TTR |
(£900k) |
The surrenderable loss is the lesser of:
- the £900k trading loss after TTR, and
- the £800k additional deduction.
In this case the TPC can surrender up to £800k and chooses to surrender the full amount. A TPC is not obliged to surrender the entire loss, but it will most likely do so.
Assuming the rates from 1 April 2025 apply (TTR10800), the amount of TTC due is therefore £360k (45% TTC rate for touring productions x £800k loss surrendered).
In this example the TTC is equal to 36% of the total core expenditure.