After a long, hard campaign, UK Games Tax Relief is finally here. It took a lot of work by a lot of people to get to this point, and we are confident it will be well worth it.
You might think it's not for your company, but we worked hard to make sure everyone in the industry can benefit. On this page we answer some of the worries people have voiced, and explain how you can claim the relief.
We've published a guide to everything that you need to know about games tax relief.
You can apply today:
You get 20% of your production costs back
The tax relief gives you a 25% credit back on your production expenditure - the money you spend on actual development, not including marketing, PR or other costs.
You can only claim it on the first 80% of those costs, however. This ultimately means that you will get roughly 20% of your production budget back as a payment from HMRC.
You can claim for costs from 1 April 2014
You can claim relief on any money you spend from 1st April this year to make a qualifying game - the scheme is live.
The Cultural Test is more flexible than you think
The cultural test that has been put in place is very flexible. It is modelled on the test that exists for film tax relief, which has allowed a very broad range of films to be supported in recent years.
You will need 16 out of 31 possible points, and can get points based on many different factors. The four categories are the content of the game - story, characters, location etc; the 'cultural contribution', such as how it reflects British culture; where it is made; and the citizenship or residency of the people who make it.
And if you have any questions, make sure that you speak to the BFI team (who administer the test). They are there to help you pass, not to stop you getting the relief.
The scheme applies to businesses of all sizes
Ukie worked hard from the very beginning to make sure that this tax relief can benefit every type of games developer in the UK.
Unlike in other countries, there is no minimum budget that your game must have. And there are no restrictions on the size or type of your company.
It works for mobile games and new business models
There is nothing at all in the rules that stops a mobile game claiming the tax relief. Indeed, we have made sure from the beginning that the Government was aware of the importance of supporting this vital part of the games industry, which will provide so much future growth.
Even more importantly, the tax relief can be claimed for continued post-release development of a game. We made sure that the Government was aware of how vital the games-as-a-service model is for the modern games industry, and will continue to be in future. As a result, you will be able to continue claiming the credit on a game that you keep working on after release.
It's easy to register as a limited company
It is true that you must be a limited company, registered in the UK tax system, in order to claim the relief. This is because it works as a credit against corporation tax.
In case you think that's an unfair burden to impose, it now costs just £15 to register a new company with Companies House, and it can be done online in almost no time right here.
There are plenty of other benefits to doing this as well, not least that you will be able to claim back VAT on many purchases.
It's not complicated to apply
You will only need three things to claim the tax relief:
- A certificate that your game passes the cultural test, which you can get from the BFI;
- Your business's normal tax return, in which you will be able to claim the relief; and
- Your business's statutory accounts
If you don't feel confident doing this yourself, you can of course get an accountant to help you. This might also help make sure you get the most benefit out of it. Several accountants are willing to offer introductory discounts to Ukie members.
Ukie member deals
We have put a number of deals in place with tax / accountancy experts who will support Ukie members games tax relief applications. All firms will offer you, as a Ukie member, free advice and consultation on games tax relief and also agree preferential rates. We are only working with companies who have an expertise in games and / or creative industries. You should contact them, mention Ukie and see how they can help.