It’s one of the lesser-known forms of government financial aid available, but the Theatre Tax Relief scheme, first introduced in September 2014, should be a key consideration for a range of businesses, not just those traditionally associated with theatre.
As the country gears up for the usual array of Christmas pantomimes and plays, the number of eligible Theatre Tax Relief (TTR) claimants is on the rise; however, many remain unaware that they could be entitled to a tax saving or repayable tax credit of up to £1,600 for every £10,000 spent on producing an event.
What is Theatre Tax Relief (TTR)?
The TTR scheme is designed to benefit both profitable and loss-making companies, as well as those who may be able to claim an exemption from corporation tax. It works by reducing the amount of taxable profits for production companies so as to reduce the their tax liability. In cases where the production company is loss-making, losses relating to the production can be boosted and surrendered in return for a cash tax credit.
Could it apply to my company?
Britain has a rich culture of theatre and drama which is evolving at a rapid pace. The rising popularity of immersive theatre, particularly at attractions such as theme parks, garden centres or seasonal events around Halloween and Christmas, means that a whole raft of new organisations could be missing out on an important form of tax relief, simply because they don’t think it applies to them.
Another type of organisation which does not immediately seem likely to be eligible for TTR is a charity. Since charities do not normally pay corporation tax, it seems unusual for them to be included. However, if they can demonstrate that they are staging a dramatic production, then the scheme is open to them and they can make a claim which may result in the payment of a tax credit.
Why should I consider TTR now?
In the run up to Christmas, when Santa’s grottoes and pantomimes appear in every town and city, companies need to be aware that TTR exists or they could be missing out on an opportunity to claim significant benefits.
For more information about the implications of Theatre Tax Relief please contact Senior Manager Will Sweeney by email at wsweeney@menzies.co.uk or by phone on 01483 758926.