UK Games Fund and Video Games Tax Relief
4th April 2016
The UK Government is determined to keep the UK at the forefront of the world’s video game production industry and as a result, there has never been better time to be a games developer in the UK.
The introduction of Video Games Tax Relief (VGTR) in April 2014 has been a major boost for developers over the past couple of years. The BFI Certification Unit have released statistics on how many games passed the culturally British test in 2015, which shows encouraging results. However, it is vitally important for the industry that developers continue to make claims, so that the government don’t take this generous relief away.
The VGTR applies to video games development companies that are engaged in the making of culturally British video game, which is developed with the intention to sell, where the company incurs at least 25% of the core development expenditure on goods or services provided from within the European Economic Area.
The main benefits of the VGTR are that companies that are eligible for this tax relief can claim a significant amount of qualifying expenditure (such as salaries and subcontractor costs) as an additional deduction in computing their taxable profits and in so doing reducing their corporation tax liability. Also, if the additional deduction creates or increases a tax loss, the company can surrender losses in return for a payable Video Games Tax Credit at a rate of 25%.
More recently we have seen the introduction of the UK Games Fund, where grants of up to £25,000 are available for developers. It should be noted that the deadline for applications for the second round of funding is 12pm on 18 April 2016, so if you are thinking about it don’t delay!
Criteria and further information on application process and timetable can be found at http://ukgamesfund.com/how-to-apply/
The Technology, Media and Innovation team at Plus Accounting specialises in tax relief claims for the creative industries. If you would like more information or to see whether you are eligible for a video games tax relief claim, contact Luke Thomas on 01273 701200 or by email at firstname.lastname@example.org
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