Surely a film just has to be set in the UK to count as a British production, right? Wrong. In fact, when it comes to claiming creative industry tax relief, there are a multitude of different factors to consider in order to class a film as British.
In today’s blog post, we’ll give you some helpful guidance on qualifying your film project as British and how this will affect your future projects.
The cultural test
The British Film Institute can officially label a film British if it passes a “cultural test”. This test looks at whether the characters speak English, whether British locations are used, and whether the cast and crew are British.
The test is points-based and the project must achieve 18 out of 35 points to pass.
If your film passes the cultural test, you might qualify for film tax relief: one of eight corporation tax reliefs available to the creative industries. You can claim this at any time, with different documentation needed depending on the status of the project.
For example…
Gravity — Whilst the main acting talent, Sandra Bullock and George Clooney are both American, and the director Alfonso Cuarón is Mexican, the film passed the test.
This is down to a number of reasons: it was produced by David Heyman, with music composed by Steven Price, both of whom are British. The film was also shot at UK studios with a local crew, the VFX studios were based in the UK, and Cuarón lives in London so can be considered a British director.
Fantastic Mr Fox — American director? Check. Mostly American cast? Also check. American film studios? Check!
But due to the film being animated, and most importantly, in UK animation studio 3 Mills, Fantastic Mr Fox was granted BFI cultural status.
Why is being a British film important?
Once your production is classed as a British film, there are a number of schemes you can take advantage of in order to claim tax relief.
Film tax relief
For all British qualifying films of any budget level, the Film Production Company (FPC) can claim a payable cash rebate up to 25% on UK qualifying expenditure.
This tax relief is capped at 80% of the core expenditure. So, even with 100% UK-qualifying expenditure, tax relief is only payable on up to 80%.
But there’s no limit on the film’s budget or the amount of relief payable within the 80% cap.
Grants
There are a plethora of grants available when making a film in the UK, including:
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- The BFI film fund
- Film4
- BBC Films
You can find a full list of grant sources on the BFI website.
EIS
In certain situations, film production companies can seek investment through the enterprise investment scheme in order to fund a project. The applicable criteria normally mean you’ll need to be using technology in a specific way.
It’s worth noting that not all companies can claim this, and the benchmarks are very rigorous.
Talk to an expert
Filmmaking in the UK should be celebrated, and thankfully there are plenty of ways to get your film the funding it needs should you pass the cultural test.
So if you need clarification on the status of your production, or any extra support in applying for funding or tax relief, contact us. We’re experts at helping creative businesses get the help they need to succeed in their projects.
Get in touch with us today to talk about your British film.
