In conjunction with it’s relocation to Sheffield, The British Games Institute (BGI) has recently opened the National Video games Museum (NVM), an interactive environment dedicated to the games culture and development, at the Kollider building, a new hub for the creative and technology industries.
As well as being a museum for the games industry, the NVM includes opportunities for video game developers to meet and interact with the game players including, for example, test labs. The NVM has proved extremely popular since its launch, selling out the first few weekends in its new home. The BGI is working on a new funding programme for the creative industries but with focus on this sector, now would seem a good time to look at the tax reliefs available for the video games and other creative industries.
Less well know than R&D and Patent Box relief, Video Games Tax Relief is one of eight tax reliefs which apply to certain qualifying companies in the creative industries which allows them to benefit from reduced tax rates.
Video Games Tax Relief operates in a similar way to the SME R&D relief in that it provides an additional deduction against taxable profits. Qualifying companies are those taking the lead role in the design and production of British video games which are intended for general sale and meet a minimum UK expenditure test.
The amount of Video Games Tax relief is based on the European Economic Area (EEA) core expenditure of a video game trade. The additional deduction is equal to the lower of 80% of total core expenditure or the actual EEA expenditure incurred. If the company is loss making, a payable tax credit is given at the rate of 25% of the additional deduction.
Relief is only for games which are certified as British by the British Film Institute. To be certified as British the game must cover a range of cultural attributes, including European locations, characters, English language, production activity in the UK and have key personnel resident in the EEA. It’s not possible to claim both Video Games Relief and R&D tax relief so companies eligible for both need to review which is the most beneficial.
Shorts' Radius team are a team of experts who can help you claim Video Games Tax Relief. Begin your journey with us today and find out just how easy it is to make your innovation pay.
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