Modifications etc. (not altering text)
C1Pt. 15 applied (with modifications) by S.I. 2007/1050, regs. 3-12 (as amended (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 2 para. 131 (with Sch. 2 Pts. 1, 2))
(1)This section applies for the purposes of this Part.
(2)“Film” includes any record, however made, of a sequence of visual images that is capable of being used as a means of showing that sequence as a moving picture.
(3)Each part of a series of films is treated as a separate film, unless—
(a)the films form a series with not more than 26 parts,
(b)the combined playing time is not more than 26 hours, and
(c)the series constitutes a self-contained work or is a series of documentaries with a common theme,
in which case the films are treated as a single film.
(4)References to a film include the film soundtrack.
(5)A film is completed when it is first in a form in which it can reasonably be regarded as ready for copies of it to be made and distributed for presentation to the general public.
(1)For the purposes of this Part “film production company” is to be read in accordance with this section.
(2)There cannot be more than one film production company in relation to a film.
(3)A company that (otherwise than in partnership)—
(a)is responsible—
(i)for pre-production, principal photography and post-production of the film, and
(ii)for delivery of the completed film,
(b)is actively engaged in production planning and decision-making during pre-production, principal photography and post-production, and
(c)directly negotiates, contracts and pays for rights, goods and services in relation to the film,
is the film production company in relation to the film.
(4)In relation to a qualifying co-production, a company that (otherwise than in partnership)—
(a)is a co-producer, and
(b)makes an effective creative, technical and artistic contribution to the film,
is the film production company in relation to the film.
(5)If there is more than one company meeting the description in subsection (3) or (4), the company that is most directly engaged in the activities referred to in that subsection is the film production company in relation to the film.
(6)If there is no company meeting the description in subsection (3) or (4), there is no film production company in relation to the film.
(7)A company may elect to be regarded as a company which does not meet the description in subsection (3) or (4).
(8)The election—
(a)must be made by the company by being included in its company tax return for an accounting period (and may be included in the return originally made or by amendment), and
(b)may be withdrawn by the company only by amending its company tax return for that accounting period.
(9)The election has effect in relation to films which commence principal photography in that or any subsequent accounting period.
(1)In this Part “film-making activities”, in relation to a film, means the activities involved in development, pre-production, principal photography and post-production of the film.
(2)If all or any of the images in a film are generated by computer, references in this Part to principal photography are to be read as references to, or as including, the generation of those images.
(3)The Treasury may by regulations—
(a)amend subsections (1) and (2),
(b)provide that specified activities are or are not to be regarded as film-making activities or as film-making activities of a particular description, and
(c)provide that, in relation to a specified description of film, references to film-making activities of a particular description are to be read as references to such activities as may be specified.
“Specified” means specified in the regulations.
(1)In this Part, in relation to a film—
“production expenditure” means expenditure on film-making activities in connection with the film, and
“core expenditure” means production expenditure on pre-production, principal photography and post-production.
(2)For the purposes of this Part a “limited-budget film” is a film whose core expenditure is £20 million or less.
(3)In determining if a film is a limited-budget film, any core expenditure that—
(a)is incurred by a person under or as a result of a transaction entered into directly or indirectly between that person and a connected person, and
(b)might have been expected to have been of a greater amount (“the arm's length amount”) if the transaction had been between independent persons dealing at arm's length,
is treated as having been of an amount equal to the arm's length amount.
(1)In this Part “UK expenditure”, in relation to a film, means expenditure on goods or services that are used or consumed in the United Kingdom.
(2)Any apportionment of expenditure as between UK expenditure and non-UK expenditure for the purposes of this Part is to be made on a just and reasonable basis.
(3)The Treasury may by regulations amend subsection (1).
In this Part—
(a)“qualifying co-production” means a film that falls to be treated as a national film in the United Kingdom as a result of an agreement between Her Majesty's Government in the United Kingdom and any other government, international organisation or authority, and
(b)“co-producer” means a person who is a co-producer for the purposes of the agreement mentioned in paragraph (a).
In this Part “company tax return” has the same meaning as in Schedule 18 to FA 1998 (see paragraph 3(1)).